The Black Sheep Inc.'s call option has the following characteristics: Exercise price of The Black Sheep Inc.'s
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Question:
The Black Sheep Inc.'s call option has the following characteristics:
Exercise price of The Black Sheep Inc.'s call option ($) | 75 |
Annualized risk-free rate | 4.5% |
Time to the expiration of the options (years) | 0.75 |
Standard deviation of the annual stock returns for The Black Sheep Inc.'s stock | 0.45 |
Per-share price for The Black Sheep Inc.'s stock ($) | 90 |
The current value of this call option is $23.1469 dollars, according to the Black-Scholes option pricing formula. What is:
Time value premium
For a put option with the same characteristics as above, the time value premium
Related Book For
Quantitative Methods for Business
ISBN: 978-0324651751
11th Edition
Authors: David Anderson, Dennis Sweeney, Thomas Williams, Jeffrey cam
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