Exhibit 13-6
USE THE FOLLOWING INFORMATION TO ANSWER THE NEXT

question 122

Multiple Choice

Exhibit 13-6
USE THE FOLLOWING INFORMATION TO ANSWER THE NEXT QUESTION(S)
The current stock price of ABC Corporation is $53.50. ABC Corporation has the following put and call option prices that expire 6 months from today. The risk-free rate of return is 5% and the expected return on the market is 11%. $\begin{array}{ccc}\text { Exercise Price } & \text { Put Price } & \text { Call Price } \\\hline50 & \$ 1.50 & \$ 5.75 \\55 & \$ 3.25 & \ldots\end{array}$
-Refer to Exhibit 13-6. What should the price be of a call option that expires 6 month from today with a exercise price of $55?

• A) $1.33
• B) $3.08
• C) $4.58
• D) $6.07
• E) $6.33

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Definitions:

Aldosterone

A hormone produced by the adrenal glands that helps regulate blood pressure by controlling sodium and potassium levels.

Antidiuretic Hormone

A hormone that helps to control the balance of fluids in the body by reducing the amount of water excreted by the kidneys.

Pituitary Gland Hormones

Hormones secreted by the pituitary gland, an endocrine gland at the base of the brain, affecting various bodily functions.

Bloodstream

The system of blood vessels within the body through which blood flows, delivering oxygen and nutrients to organs and tissues.