Question
The price of Ervin Corp. stock will either be $63 or $82 at the end of the year. Call options are available with one year
The price of Ervin Corp. stock will either be $63 or $82 at the end of the year. Call options are available with one year until expiration. Continuously compounded T-bills currently yield 2.34 %. Suppose the current price of Ervin stock is $76. What is the value of the call if the strike price is $55 per share?
(Round answer to 2 decimal places. Do not round intermediate calculations).
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Foundations Of Financial Management
Authors: Stanley B. Block, Geoffrey A. Hirt, Bartley R. Danielsen
13th Edition
0073382388, 978-0073382388
