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?
Definitions:
Alkylamine
A compound resulting from the replacement of one or more hydrogen atoms of ammonia (NH3) with alkyl groups.
α-Carbon
The first carbon atom attached directly to a functional group in an organic molecule.
Chemical Shift
A term used in nuclear magnetic resonance (NMR) spectroscopy to describe the change in the resonance frequency of a nucleus due to its chemical environment.
Cyclohexylamine
An organic compound derived from cyclohexane where one hydrogen atom is replaced by an amine group, known for its use in creating various chemical products.
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