The Corrado Miller Approximation Formula for the Volatility of a stock

where K is the present value of the strike price

and X is the price of the stock

and E is the strike price

and C is the price of the call option

and T-t is the time to expiration is years.

If the price of the stock is $105 and the strike price is $100 and the time to expiration is 13 weeks and the risk-less interest rate is 12% per annum continuously compounded and the price of the call is $16.43 per share then algebraically find the associated volatility per annum. Your final answer should be correct to 3 places after the decimal point.

1 J21 is given by or VT-t X+K [C- X-K + 2 Vc- *;K, _(X K), TT 1 J21 is given by or VT-t X+K [C- X-K + 2 Vc- *;K, _(X K), TT