Assume a Stock Price of $16

question 2

Multiple Choice

Assume a stock price of $16.80, risk-free rate of 2.7 percent, standard deviation of 59 percent, N(d₁) value of .93116, and an N(d₂) value of .85708. What is the value of a 6-month call with a strike price of $10 given the Black-Scholes option pricing model?

• A) $7.62
• B) $7.19
• C) $8.06
• D) $7.85
• E) $6.97

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Definitions:

Automobile Emissions

Pollutants released into the atmosphere by motor vehicles, contributing to air pollution and greenhouse gas concentrations.

Non-Renewable Fossil Fuels

Natural resources such as coal, oil, and natural gas that cannot be replenished within a human lifespan.

Industrial-Medical Revolution

A significant transformation in industry and medicine, often characterized by technological advancements and improved health care.