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Question: Consider two investors who agree on the stock's price and volatility but who do not agree on the stock's expected return. One believes that the stock price will earn 15 percent over the next year, while the second believes that it will have a negative 5 percent return. Will they agree or disagree on the value of a one-year call option on the stock when using the Black-Scholes- Merton model? Explain your answer.

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Category:- Basic Finance
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