A stock is selling for $48 a share.The 6-month options have an exercise price of $50.The risk-free rate is 3.5 percent,the standard deviation is 32 percent,and the d₁ value is .01007.What is the value of d₂?

Name: A stock is selling for $48 a share.The 6-month options have an exercise price of $50.The risk-free rate is 3.5 percent,the standard deviation is 32 percent,and the d 1 value is .01007.What is the value of d 2 ?
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Question

Quizplus · Accepted Answer

d₂ = .01007 - (.32 × √.50)= -.21620

A Stock Is Selling for $48 a Share