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T-bills currently yield 3.4 percent. Stock in Deadwood Manufacturing is currently selling for $71 per share. There is no possibility that the stock will be
| T-bills currently yield 3.4 percent. Stock in Deadwood Manufacturing is currently selling for $71 per share. There is no possibility that the stock will be worth less than $64 per share in one year. |
| a-1. | What is the value of a call option with a $56 exercise price? (Round your answer to 2 decimal places, e.g., 32.16.) |
| a-2. | What is the intrinsic value? |
| b-1. | What is the value of a call option with a $49 exercise price? (Round your answer to 2 decimal places, e.g., 32.16.) |
| b-2. | What is the intrinsic value? |
| c-1. | What is the value of a put option with a $56 exercise price? |
| c-2. | What is the intrinsic value? |
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