When the Non-Dividend Paying Stock Price Is $20,the Strike Price

question 15

Multiple Choice

When the non-dividend paying stock price is $20,the strike price is $20,the risk-free rate is 6%,the volatility is 20% and the time to maturity is 3 months which of the following is the price of a European call option on the stock

• A) 20N(0.1)-19.7N(0.2)
• B) 20N(0.2)-19.7N(0.1)
• C) 19.7N(0.2)-20N(0.1)
• D) 19.7N(0.1)-20N(0.2)

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Definitions:

Expected Frequency

A term often used in genetics and statistics referring to the predicted frequency of a particular genotype or allele in a population, based on theoretical assumptions.

Alleles

Variants of a gene found at the same place on a chromosome that code for different traits.

Phenotypic Trait

An observable and measurable characteristic of an organism, such as morphology, development, biochemical or physiological properties, or behavior, that may be influenced by both genetic and environmental factors.

Total Variance

A statistical measure that quantifies the overall variability within a dataset, encompassing all sources of variation.