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You are given the following information concerning options on a particular stock: Stock price = $59 Exercise price = $55 Risk-free rate = 4% per
| You are given the following information concerning options on a particular stock: |
| Stock price | = | $59 |
| Exercise price | = | $55 |
| Risk-free rate | = | 4% per year, compounded continuously |
| Maturity | = | 3 months |
| Standard deviation | = | 48% per year |
| a. | What is the intrinsic value of each option? (Leave no cells blank - be certain to enter "0" wherever required. Do not round intermediate calculations.) |
| Value | |
| Call option | $ |
| Put option | $ |
| b. | What is the time value of each option? (Do not round intermediate calculations and round your final answers to 2 decimal places (e.g., 32.16).) |
| Value | |
| Call option | $ |
| Put option | $ |
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