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The current stock price of International Paper is $69, and the stock does not pay dividends. The instantaneous risk-free rate of return is 10%. The

  1. The current stock price of International Paper is $69, and the stock does not pay dividends. The instantaneous risk-free rate of return is 10%. The instantaneous standard deviation of International Paper's stock is 25%. You want to purchase a put option on this stock with an exercise price of $70 and an expiration date 73 days from now.
  2. Using the Black-Scholes OPM, the put option should be worth __________ today.
  3. $1.50
  4. $2.88
  5. $2.55
  6. $3.00

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