Problembaddam is considering investing in a call option on, Ask an Expert

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Problem:

Baddam is considering investing in a call option on Conner Computers stock. The option will expire in one year and the exercise price is $45. The risk-free rate is 6%. Conner Computers is selling for $39 per share and Baddam estimates the variance of the return on the stock is 0.006.

Required:

Question: What is the price of this call option?

Note: Please show how to work it out.

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Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M91148719

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