Start with the partial model in the file Ch08 P08 Build a Model.xls on the textbook's Web
Question:
Start with the partial model in the file Ch08 P08 Build a Model.xls on the textbook's Web site. You have been given the following information for a call option on the stock of Puckett Industries: P = $65.00, X = $70.00, t = 0.50, rRF = 5.00% and σ =50.00%.
a. Use the Black-Scholes option pricing model to determine the value of the calloption.
b. Suppose there is a put option on Puckett's stock with exactly the same inputs asthe call option. What is the value of the put?
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a Using the BlackScholes model to determine the call option value The BlackScholes model is a mathem...View the full answer
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Related Book For 
Financial management theory and practice
ISBN: 978-1439078099
13th edition
Authors: Eugene F. Brigham and Michael C. Ehrhardt
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