A5 Consider a European call option on a stock. The call option will expire in...
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A5 Consider a European call option on a stock. The call option will expire in 6 months. The current stock price is $30, and the strike price of the call option is $20. At the expiration date, the stock price can either be $35 or it can be $25. The risk free interest rate is 4%. What is the value of the European call option today? [6]
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