You have been granted stock options on 300 shares of your employer's stock. The stock is currently selling for $37.80 and has a standard deviation of 30%. The option's strike price is $35 and the time to maturity is 10 years. What is the value of each option given a risk-free rate of 3.0 % ? Assume that no dividends are paid. The standard normal probabilities are: N(-d1).19169 N(-d2)=.53068
You have been granted stock options on 300 shares of your employer's stock. The stock is currently selling for $37.80 and has a standard deviation of 30%. The option's strike price is $35 and the time to maturity is 10 years. What is the value of each option given a risk-free rate of 3.0 % ? Assume that no dividends are paid. The standard normal probabilities are: N(-d1).19169 N(-d2)=.53068
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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You have been granted stock options on 300 shares of your employer's stock. The stock is currently selling for $37.80 and has a standard deviation of 30%. The option's strike price is $35 and the time
to maturity is 10 years. What is the value of each option given a risk-free rate of 3.0 % ? Assume that no dividends are paid.
The standard normal probabilities are:
N(-d1)= .19169
N(-d2)=53068
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