The price of Dimension,Inc.stock will be either $65 or $87 at the end of the year.Call options are available with one year to expiration.T-bills currently yield 5 percent.Suppose the current price of Dimension stock is $70.What is the value of the call option if the exercise price is $70 per share?
A) $6.26
B) $8.48
C) $11.58
D) $15.39
E) $17.62
Correct Answer:
Verified
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