What Is the Call Option Premium Given the Following Information

question 74

Multiple Choice

What is the call option premium given the following information?
$\begin{array}{lrr} \text { Stock price } &\$45.00\\ \text { Strike price } &\$40.00\\ \text { Volatility } &35\%\\ \text {Dividend Yield } &0\\ \text { Time (years) } &.50\\ \text { Risk-free Rate } &3.50\%\\\end{array}$

• A)$4.63
• B)$5.28
• C)$6.39
• D)$7.60
• E)$8.66

---

Definitions:

Produce Cheese

The process of converting milk into cheese through various techniques that involve coagulation, curdling, and fermentation.

Trading Partners

Countries or entities that engage in the exchange of goods, services, or information.

Largest

Being the greatest in size, quantity, or degree compared to others in a set or group.

United States

A federal republic consisting of 50 states, a federal district, five major self-governing territories, and various possessions.