consider the valuation of a European call on stock XYZ with a strike price of...
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consider the valuation of a European call on stock XYZ with a strike price of $110 and a term to maturity of three months. Assume the stock price is $50 today and it has a lognormal distribution with volatility of 30% over the life of the option. In addition, the continuously compounded risk free rate is 3% per year. Using the Black-Scholes formula, what is the theoretical value of the call? Please include calculstions in answer. will give thumbs up! preferably answer in excel if possible
Please include calculstions in answer. will give thumbs up!
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