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Question
Assume a stock price of S(0) = $80.00, r = 0.05, σ = 0.35, and dividend = 0.01. What is the price of a claim that pays S-2/3? Use formula 20.29.A) $0.25
B) $0.35
C) $0.05
D) $0.15
Answer
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Related questions
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Assume the following: LN(S) and LN(Q) have a correlation coefficient of -0.65, S(0) = 55, Q(0) = 60, r = 0.04, σs = 0.22 σQ = 0.15, and dividends = 0. Using formula 20.39, what is the price of a claim that pays Q/?
A) $8.16
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Q:
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