10 6 points Use the Black-Scholes formula for the following stock: Time to expiration 6 months Standard deviation 53% per year Exercise price $43 Stock price $43 Annual interest rate 3% Dividend 0 eBook Recalculate the value of the call with the following changes: a. Time to expiration b. Standard deviation Print c. Exercise price References d. Stock price e. Interest rate 3 months 25% per year $49 $49 5% Select each scenario independently. Note: Round your answers to 2 decimal places. Value of the Call Option a. C falls to b. C falls to c. C falls to d. C rises to e. C rises to Check my work
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- Use the Black-Scholes formula for the following stock: Time to expiration Standard deviation Exercise price Stock price Annual interest rate Dividend 6 months 53% per year $43 $43 3% 0 Recalculate the value of the call with the following changes: a. Time to expiration b. Standard deviation 3 months c. Exercise price d. Stock price e. Interest rate 25% per year $49 $49 5% Select each scenario independently. Note: Round your answers to 2 decimal places. Value of the Call Option a. C falls to b. C falls to c. C falls to d. C rises to e. C rises toUse the Black-Scholes formula for the following stock: Time to expiration Standard deviation Exercise price Stock price Annual interest rate Dividend 6 months 56% per year $55 $55 6% 0 Recalculate the value of the call with the following changes: a. Time to expiration b. Standard deviation c. Exercise price d. Stock price e. Interest rate 3 months 30% per year $63 $63 9% Select each scenario independently. Note: Round your answers to 2 decimal places. a. b. C. d. e. Value of the Call OptionReview the following market information: Current Stock Market Return 11.25% Current T-Bill Price $979.43 Historic T-Bill Average Return 2.80% Historic Stock Market Average Return 8.10% Stock Beta 1.23 What is the required return (rounded to two places)?
- What is the most you should be willing to pay for the stock in the table? Expected Expected Price in 1Dividend in 1 year Required Current Return Price Year $376.29 $3.91 5.80% $89.00A stock has had the following year-end prices and dividends: Year Price 0 012345 1 $ 15.00 17.18 18.18 16.68 19.02 22.13 Dividend $ 0.15 0.38 0.40 0.42 0.48 What are the arithmetic and geometric returns for the stock? Note: Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places. Arithmetic return Geometric return % %Review the following market information: Current Stock Market Return 11.25% Current T-Bill Price $979.43 Historic T-Bill Average Return 2.80% Historic Stock Market Average Return 8.10% Stock Beta 1.54 What is the required return (rounded to two places)? Multiple Choice None of the above 10.26% 10.96% 16.19% 15.11%
- H5. A stock has had the following year-end prices and dividends: Year Price Dividend 1 $40 — 2 $55 $1.10 3 $60 $1.20 4 $70 $1.30 The geometric average return for the stock is ______%. Group of answer choices 23. 45 20 28. 35 22. 86 33 .41 Show proper step by step calculation and explain with detailsUse the Black-Scholes formula for the following stock: Time to expiration Standard deviation Exercise price 6 months 54% per year $54 Stock price $54 Annual interest rate 4% 0 Dividend Recalculate the value of the call with the following changes: a. Time to expiration. b. Standard deviation 3 months c. Exercise price d. Stock price 20% per year $60 $60 6% e. Interest rate Select each scenario independently. Note: Round your answers to 2 decimal places. Value of the Call Option a. C falls to b. C falls to C. C falls to d. C rises to e. C rises toA stock has the following prices at the end of each of the following 5 years. What is the geometric average return over the period? Year 20x1 20x2 20x3 20x4 20x5 b. 1.17% 4 c. 2.26% d. 1.94% Price $2.17 $2.19 $2.12 $2.51 $2.3 Finish review
- SECURITY MARKET LINE You are given the following historical data on market returns, r, and the returns on Stocks A and B, r, and rp: 8A-2 M' A Year 1 29.00% 29.00% 20.00% 2 15.20 15.20 13.10 (10.00) (10.00) 0.50 4 3.30 3.30 7.15 5 23.00 23.00 17.00 31.70 31.70 21.35What is the expected return for the following portfolio? (State your answer in percent with two decimal places.) Stock Expected returns Investment AAA 35% $500,000 BBB 29% $1,300,000 CCC 18% $1,200,000 DDD 7% $1,500,000 O.17.13% O.19.40% O.21.01% O.22.21% O.23.88%What is Stock X's geometric returns if it has the following returns? Year 1 8% Year 2 - 5% Year 3 10% Year 4 - 6% Year 5 15% a. 4.1%. b. 5.2% c. 6.8% d. 8.5%