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You would like to buy a call option on Tardy Airlines Inc. The stock currently trades at $94. You believe the stock has a lot
You would like to buy a call option on Tardy Airlines Inc. The stock currently trades at $94. You believe the stock has a lot of potential, so you are willing to take some risk and buy a call option with a strike price of $110 that will expire exactly 4 months from now. The stock does not pay a dividend. The volatility of the stocks return is 35% and the risk-free rate is 2%. Using MS Excel, calculate the price of this call option. You may use the spreadsheet posted on Canvas. Please attach the spreadsheet to the homework.
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