individual exercises

Binomial Model – Suppose the stock price can go up 15% or down 13% over the next year. You own a 1 year put on the stock. The interest rate is 10% and the stock price is $60.

What exercise price leaves you indifferent between holding the put or exercising it now

How does this break-even exercise price change if the interest rate is increased?

Black-Scholes Model – Use the Black-Scholes Model to value the following options:

A call option written on a stock selling at $60/share with a $60 exercise price. The stock’s standard deviation is 6% per month. The option matures in 3 months. The risk free interest rate is 1% per month.

A put option written on the same stock at the same time, with the same exercise price, and expiration date.

Do you need a similar assignment done for you from scratch? We have qualified writers to help you. We assure you an A+ quality paper that is free from plagiarism. Order now for an Amazing Discount!
Use Discount Code "Newclient" for a 15% Discount!

NB: We do not resell papers. Upon ordering, we do an original paper exclusively for you.