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Problem 3. Assume that the price of a stock follows a GBM model and K = 50$, So = 45$, 1 ,T 1,0 = 20%,
Problem 3. Assume that the price of a stock follows a GBM model and K = 50$, So = 45$, 1 ,T 1,0 = 20%, r = 5%. Find the price of a fixed strike continuous geometric average call option on one share of the stock. Compare it to the price of a standard call option. Problem 3. Assume that the price of a stock follows a GBM model and K = 50$, So = 45$, 1 ,T 1,0 = 20%, r = 5%. Find the price of a fixed strike continuous geometric average call option on one share of the stock. Compare it to the price of a standard call option
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