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The spot price of Facebook (FB) is $150. The risk free rate is 3%. Assume that FB follows a log-normal model with volatility 20% and

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The spot price of Facebook (FB) is $150. The risk free rate is 3%. Assume that FB follows a log-normal model with volatility 20% and expected rate of return 10%. Consider a 1-year 150-180 bull spread on FB made of calls. What is the probability that the pay-off of this bull-spread is $20 or more? The spot price of Facebook (FB) is $150. The risk free rate is 3%. Assume that FB follows a log-normal model with volatility 20% and expected rate of return 10%. Consider a 1-year 150-180 bull spread on FB made of calls. What is the probability that the pay-off of this bull-spread is $20 or more

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