Repeat the previous problem, but this time for perpetual options What do you notice about the prices What do you notice about the exercise barriers In previous problem Let S $100, K $90, 30 , r 8 , 5 , and T 1 a What is the Black Scholes call price b Now price a put where S $90, K $100, 30 , r 5 , 8 , and T 1 c What is the link between your answers to (a) and (b) Why

Question: Repeat the previous problem, but this time for perpetual options. What do you notice about the prices? What do you notice about the exercise barriers?

Repeat the previous problem, but this time for perpetual options. What do you notice about the prices? What do you notice about the exercise barriers?
In previous problem Let S = $100, K = $90, σ = 30%, r = 8%, δ = 5%, and T = 1.
a. What is the Black-Scholes call price?
b. Now price a put where S = $90, K = $100, σ = 30%, r = 5%, δ = 8%, and T = 1.
c. What is the link between your answers to (a) and (b)? Why?

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