Use the Following Information to Answer the Question(s)below

question 24

Multiple Choice

Use the following information to answer the question(s) below.
(Please use a copy of the Cumulative Probabilities for the standard normal distribution for these problems. )
Taggart Transcontinental's stock has a volatility of 25% and a current stock price of $40 per share.Taggart pays no dividends.The risk-free interest rate is 4%.
-The Black-Scholes value of a one-year call option on Taggart stock with a strike price of $50 is closest to:

• A)$1.45.
• B)$3.15.
• C)$4.75.
• D)$9.50.

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Definitions:

Organization's Strategy

A plan of action designed by an entity to achieve a long-term or overall aim and secure a competitive position in the market.

Level of Involvement

The degree or extent to which individuals or groups are engaged in a process, project, or decision.

Acquisition

Acquisition refers to the process of acquiring control of one company by another, either through purchase or merger.

Auto Parts

Components and accessories used in the manufacturing and maintenance of automobiles.