Question: 4. Compare the following two call options, written on two different stocks: Dividend yield 0% 0% Call A B T 1 1 Which stock

4. Compare the following two call options, written on two different stocks:

4. Compare the following two call options, written on two different stocks: Dividend yield 0% 0% Call A B T 1 1 Which stock must have the higher implied volatility? Explain briefly. S 50 55 K 50 50 Option price $8 14

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