Question
Suppose a non-dividend paying stock is trading at $175 per share and has a volatility of 45%. What is the fair price of a 9-month
Suppose a non-dividend paying stock is trading at $175 per share and has a volatility of 45%. What is the fair price of a 9-month European call option with a strike price of $190 per share using 1 binomial period? Assume the risk-free rate is 1%.
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Fundamentals Of Investing
Authors: Scott B. Smart, Lawrence J. Gitman, Michael D. Joehnk
13th Edition
978-0134083308, 013408330X
