Question
The price of Ervin Corp. stock will either be $67 or $86 at the end of the year. Call options are available with one year
The price of Ervin Corp. stock will either be $67 or $86 at the end of the year. Call options are available with one year until expiration. Continuously compounded T-bills currently yield 4.62 %. Suppose the current price of Ervin stock is $72.
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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Personal Finance
Authors: Jack Kapoor, Les Dlabay, Robert Hughes
10th Edition
0073530697, 9780073530697
