You Own a Call Option on Jasper Co

question 33

Multiple Choice

You own a call option on Jasper Co. stock that expires in one year. The exercise price is $42.50. The current price of the stock is $56.00 and the risk-free rate of return is 3.5%. Assume that the option will finish in the money. What is the current value of the call option?

• A) $13.04
• B) $13.50
• C) $13.97
• D) $14.94
• E) $15.46

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