The Black Sheep Inc.'s call option has the following characteristics:

Exercise price of The Black Sheep Inc.'s call option ($)	75
Annualized risk-free rate	4.5%
Time to the expiration of the options (years)	0.75
Standard deviation of the annual stock returns for The Black Sheep Inc.'s stock	0.45
Per-share price for The Black Sheep Inc.'s stock ($)	90

The current value of this call option is $23.1469 dollars, according to the Black-Scholes option pricing formula. What is: 

Time value premium 

For a put option with the same characteristics as above, the time value premium

Answer rating: 100% (QA)

The Black Scholes option pricing formula separates the total value of an option into two components View the full answer