You Own a Call Option on Anneco Stock That Expires

question 91

Multiple Choice

You own a call option on Anneco stock that expires in one year.The exercise price is $34.50.The current price of the stock is $36.00 and the risk-free rate of return is 3%.Assume that the option will finish in the money.What is the current value of the call option?

• A)$1.50
• B)$2.50
• C)$3.50
• D)$4.50
• E)$5.50

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