Question: Assume the following values when none is specified: So =100 =20% T =1 K =100 r =5% Exercise 1- Call Option Pricing 1. What is

Assume the following values when none is specified: So =100 =20% T =1 K =100 r =5% Exercise 1- Call Option Pricing 1. What is the price of the Call option with the above features in a Black-Scholes-Merton framework? 2. Plot the Black-Scholes-Merton Call price for different values of S0. What do you observe? Can you explain intuitively what is going on? 3. Plot the Black-Scholes-Merton Call price for different values of T. What do you observe? Can you explain intuitively what is going on? 4. Plot the Black-Scholes-Merton Call price for different values of . What do you observe? Can you explain intuitively what is going on? 5. Plot the Black-Scholes-Merton Call price for different values of r. What do you observe? Can you explain intuitively what is going on

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14. Now reconcile what you answered to problem 15 with problem 13.

11. In what environment or contexts is it the value you want others to associate you with that the value can best be expressed in? Do you seek out these contexts to learn?