Atampt current stock price is 35 per share stock analyst, Ask an Expert

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AT&T current stock price is $35 per share, stock analyst predict the stock will be selling in between $20 and $45 in one year. the rate on the one year T-Bill is three percent. the most popular call option with one year expiration, for AT&T stock has an excersisce price of $30. use the binomial option-pricing model to create a riskless hedge investment.

a) After the payoffs have been equalized and the riskless hedge investment is created, what is the value of this portfolio in one year?

b) what is the value of the call or the call price?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M93040898

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