# Question: Using the data in Table 21 1 compare the price on

Using the data in Table 21.1, compare the price on July 24, 2009, of the following options on JetBlue stock to the price predicted by the Black-Scholes formula. Assume that the standard deviation of JetBlue stock is 65% per year and that the short-term risk-free rate of interest is 1% per year.

a. December 2009 call option with a $5 strike price

b. December 2009 put option with a $6 strike price

c. March 2010 put option with a $7 strikeprice

a. December 2009 call option with a $5 strike price

b. December 2009 put option with a $6 strike price

c. March 2010 put option with a $7 strikeprice

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