Question
The price of Ervin Corp. stock will either be $62 or $85 at the end of the year. Call options are available with one year
The price of Ervin Corp. stock will either be $62 or $85 at the end of the year. Call options are available with one year until expiration. Continuously compounded T-bills currently yield 2.54 %. Suppose the current price of Ervin stock is $71.
What is the value of the call option if the strike price is $75 per share? (Round answer to 2 decimal places)
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International Financial Markets And The Firm
Authors: Piet Sercu, Raman Uppal
1st Edition
1861523548, 978-1861523549
