Question: We can decompose an option's value into four parts: 1) the intrinsic value.2) the time value of money. 3) the insurance value, and 4)

We can decompose an option's value into four parts: 1) the intrinsic

We can decompose an option's value into four parts: 1) the intrinsic value.2) the time value of money. 3) the insurance value, and 4) the impact.of.navouts.(dividends) Given the following data on stocks and options S-$50, K-$40, -10%, T-1.D $2 and will be paid out at T -0.5 Determine the following values for a European call option selling at $15 today Intrinsic value (Enter numeric value only, no dollar sign or comma. Keep 2 decimal places) Time Value of Money Insurance value Impact of dividends: (Enter numeric value only, no dollar sign or comma. Keep 2 decimal places) (Enter numeric value only, no dollar sign or comma. Keep 2 decimal places) (Enter numeric value only, no dollar sign or comma. Keep 2 decimal places. HINT: this value bears a negative sign)

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