Question 12

12. One-Period Binomial Option Pricing (LO1, CFA2) $74 and will move up by a factor of 1.20 or down by a factor of 0.80 over the next period. The risk-free rate of interest is 4.2 percent. What is the value of a call option with a strike price of $75? One-Period Binomial Option Pricing (LO1, CFA2) has a put option available with a strike price of $55. The stock will move up by a factor of 1.13 or down by a factor of 0.88 over the next period and the risk-free rate is 3 percent. What is the price of the put option? Black-Scholes Model (LO2, CFA2) stock price is $70 and the stock's return has a standard deviation of 20 percent per year. The A stock is currently priced at 13. A stock with a current price of $58 te Questions 14. A call option matures in six months. The underlying