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9) Suppose that a European call on Nike stock has a strike price of $100....

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9) Suppose that a European call on Nike stock has a strike price of $100. The option matures in six months. The volatility of Nike stock is 30% per year, the risk-free rate of interest is 2% and Nike is currently selling for $105. a) Use Black-Scholes to price this option. b) Use the put-call parity condition to price a European put on Nike with a strike price of $100 and a maturity of 6 months. 10) Suppose that a European call on the British pound has a strike price of $1.50/. The option matures in nine months. The volatility of the British pound/dollar exchange rate is 40% per year, the U.S. risk-free rate of interest is 2%, the U.K. risk-free rate of interest is 4% and the exchange rate between the dollar and the pound is currently $1.60/E. a) Use Black-Scholes to price this option. b) Use the put-call parity condition to price a European put on the British pound with a strike price of $1.50/ and a maturity of 9 months

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