# Question: Four years after the option grant the stock price for

Four years after the option grant, the stock price for Analog Devices was about $40. Using the same input as in the previous problem, compute the market value of the options granted in 2000, assuming that they were issued at strikes of $44.50 and $63.25.

**View Solution:**## Answer to relevant Questions

Suppose that a firm offers a 3-year compensation option that vests immediately. An employee who resigns has two years to decide whether to exercise the option. Compute annual compensation option expense using the stock price ...The firm is considering an investment project costing $1. What is the amount by which the project's value must exceed its cost in order for shareholders to be willing to pay for it? Repeat for project values of $10 and $25. A project has certain cash flows today of $1, growing at 5% per year for 10 years, after which the cash flow is constant. The risk-free rate is 5%. The project costs $20 and cash flows begin 1 year after the project is ...Repeat Problem 17.18 assuming that the volatility of gold is 20% and that once opened, the mine can be costlessly shut down forever. What is the value of the mine? What is the price at which the mine will be shut down? You drawthese five numbers randomly from a normal distribution with mean−8 and variance 15: {−7, −11, −3, 2, −15}. What are the equivalent draws from a standard normal distribution?Post your question