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a. In Black Scholes option pricing model explain what it means if N(d1 ) is 0.45 in terms of the movements in the stock and call option price.

b. What is N(d1 ) referred to (what is the name) and what does it show?

c. How many call options can you write on one share of stock if N(d1 ) is 0.5 in order to have a fully neutral hedged position?

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