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A Stock with a Current Price of $25 Will Either

Question 48

Multiple Choice

A stock with a current price of $25 will either move up to $32 or down to $20 over the next period. The risk-free rate of interest is 3.5%. What is the value of a call option with a strike price of $30?


A) $.68
B) $.74
C) $.95
D) $1.12
E) $1.31

Correct Answer:

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