# Question: Assume that S 45 K 40 r

Assume that S = $45, K = $40, r = 0.05, δ = 0.02, and σ = 0.30. Using the up rebate formula (equation (23.21)), find the value of H that maximizes (H − K) × UR(S, σ, r , T , δ), for T = 1, 10, 100, 1000, and 10,000. Compare both H and

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