A stock is currently selling for $46. In one period, the stock will move up by a factor of 1.23 or down by a factor of .61. A call option with a strike price of $54 is available. If the risk-free rate of interest is 2.5 percent for this period, what is the value of the call option? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Answer rating: 100% (QA)

To calculate the value of the call option you can use the oneperiod binomial option pricing ... View the full answer