The expected return on a stock is 15% compounded continuously. The continuously compounded risk-free interest rate is

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The expected return on a stock is 15% compounded continuously. The continuously compounded risk-free interest rate is 7% and the call elasticity on this stock is 4:5. Find the expected annual continuously compounded return on the call option.

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Investment

ISBN: 978-0073530703

9th edition

Authors: Zvi bodie, Alex kane, Alan j. marcus

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Posted Date: Nov 30, 2020 01:45 AM

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The expected return on a stock is 15% compounded continuously. The continuously compounded risk-free interest rate is

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