Exhibit 22.6 Use the Information Below for the Following Problem(S)

question 105

Multiple Choice

Exhibit 22.6
Use the Information Below for the Following Problem(S)
The following information is provided in the context of a two period (two six month periods) binomial option pricing model. A stock currently trades at $60 per share, a call option on the stock has an exercise price of $65. The stock is equally likely to rise by 15% or fall by 15% during each six month period. The one-year risk free rate is 3%.
-Refer to Exhibit 22.6.Calculate the possible prices of the stock at the end of one year.

• A) $69, $51, $79.35
• B) $51, $79.35, $58.65
• C) $79.35, $58.65, $43.35
• D) $58.65, $43.35, $14.35
• E) None of the above

---

Definitions:

Dreaming

A series of thoughts, images, and sensations occurring in a person’s mind during sleep.

Organizational Change Interventions

Planned activities or programs aimed at improving an organization's effectiveness through changes in processes, culture, or infrastructure.

Ethical Issues

Challenges or situations that require a choice between options that must be evaluated as right or wrong, ethical or unethical.

Cultural Setting

The collection of beliefs, practices, norms, and values shared by a group of people that influences their behaviors and interactions.