Question

i am trying to solve a past paper and we can't use any excel so have...

i am trying to solve a past paper and we can't use any excel so have to solve this question on paper.

If the spot price of an underlying is $50 and its volatility is 20%. Interest rates are at 10% with continuous compounding. What is the fair price for a three month call option with a strike price of $52. Show and explain your calculations.

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Answer #1

SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE

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