Use black scholes model 9a. Calculate the value of a 6-month binary call option on the...

Use black scholes model

9a. Calculate the value of a 6-month binary call option on the asset that has a strike price of 75. b. Calculate the value of a 6-month binary put option on the asset that has a strike price of 75.

assume the current spot price of the underlying assets is 77.50, its cash yield is 0.45%, its standard deviation is 0.725, and the risk free interest rates is 2.0%.

Expert Solution

ANSWER IN THE IMAGE((YELLOW HIGHLIGHTED). FEEL FREE TO ASK ANY DOUBTS. THUMBS UP PLEASE.

1. CALL

2. PUT

jeff jeffy answered 2 years ago

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