Question: PLEASE SHOW HOW IT'S DONE IN EXCEL. 1 . ( Lower bound of call ) You want to buy one American call option contract on
PLEASE SHOW HOW IT'S DONE IN EXCEL.
Lower bound of call You want to buy one American call option contract on ABC Computer, expiring in months, with a strike price of $ The current stock price is at $
a Can the option price be lower than $ Assume that the interest rate is
b Assume that you can buy the call for $which is less than the theoretical minimum How can you exploit the mispricing to make a riskless gain?
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