Assume S = $52,K = 50,div = 0

question 15

Multiple Choice

Assume S = $52,K = 50,div = 0.01,r = 0.06,σ = 0.22,and 45 days until expiration.What is the premium on an Asian average strike call where N = 1?

• A) $0.00
• B) $0.10
• C) $0.20
• D) $0.30

---

Definitions:

Maintain Ratio

The requirement to keep a consistent ratio, often used in the context of financial ratios by firms to ensure stability or compliance with regulations.

Solve for X

The process of determining the value of the variable X that satisfies a given equation.

Proportion

A proportion is a mathematical relationship showing that two ratios or fractions are equal.

Ownership Ratio

The proportion of a company or property owned by an individual or entity, often expressed as a percentage.