The current price of a stock is 15 in 6 months the price, Ask an Expert

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The current price of a stock is $15. In 6 months, the price will be either $19 or $11. The annual risk-free rate is 3%. Find the price of a call option on the stock that has an strike price of $12 and that expires in 6 months. (Hint: Use daily compounding.) Round your answer to the nearest cent. Assume a 365-day year. Do not round your intermediate calculations.

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M91781507

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