Calculate the Price of a Call Option Using the Black

question 90

Multiple Choice

Calculate the price of a call option using the Black Scholes model and the following data: stock price = $47.30, exercise price = $50, time to expiration = 85 days, risk-free rate = 3%, standard deviation = 35%.

• A) $1.11
• B) $2.22
• C) $3.33
• D) $4.44

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Days' Sales Uncollected

A measure of how quickly a company converts its accounts receivable into cash, indicating the average number of days sales remain uncollected.

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Acid-Test Ratio

A financial metric used to determine a company's short-term liquidity position by comparing its most liquid assets, excluding inventories, against its short-term liabilities.

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