The Following Quotes Were Observed for Options on a Given

question 18

Multiple Choice

The following quotes were observed for options on a given stock on November 1 of a given year. These are American calls except where indicated. Use the information to answer questions 7 through 20.

The stock price was 113.25. The risk-free rates were 7.30 percent (November) , 7.50 percent (December) and 7.62 percent (January) . The times to expiration were 0.0384 (November) , 0.1342 (December) , and 0.211 (January) . Assume no dividends unless indicated.
-The maximum difference between the January 105 and 110 calls is which of the following?

• A)11.50
• B)4.92
• C)5.00
• D)4.0
• E)none of the above