The Current Stock Price of National Paper Is $69, and the Stock

question 6

Multiple Choice

The current stock price of National Paper is $69, and the stock does not pay dividends. The instantaneous risk-free rate of return is 10%. The instantaneous standard deviation of National Paper's stock is 25%. You want to purchase a call option on this stock with an exercise price of $70 and an expiration date 73 days from now.
Using the Black-Scholes OPM, the call option should be worth ________ today.

• A) $2.50
• B) $2.94
• C) $3.26
• D) $3.50

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Definitions:

Criminal Status

The designation of an individual who has been convicted of a crime by a judicial body.

Labeling Approach

A perspective in sociology and criminology that emphasizes the importance of societal labels in the development of deviant identity.

Sociologists

Scholars or practitioners who study human society and social behavior by examining the groups, cultures, organizations, social institutions, and processes that develop when people interact and work together.

Deviance

Conducts that defy what is socially accepted or expected by societal standards.