Assume That the Current Price of TGT Stock Is $33

question 98

Short Answer

Assume that the current price of TGT stock is $33, that a 6 month call option on the stock has a strike or exercise price of $35.00, the risk free rate is 4%, and that you have calculated N(d1)as .65 and N(d2)as .55.Use the Black-Scholes model to calculate the price of the option.

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Definitions:

Charles Spearman

An early 20th-century psychologist known for his work in statistics and intelligence theory, famous for proposing the concept of a general intelligence factor, "g".

General Intelligence

General Intelligence, often abbreviated as "g", is a theory suggesting that a single factor underlies various cognitive abilities, reflecting a person's overall intellectual capability.

Crystallized Intelligence

The ability to use skills, knowledge, and experience acquired over a lifetime, often increasing with age.

Visual-motor Abilities

Skills that involve coordination between visual perception and motor control, supporting tasks like writing and catching a ball.