Consider an option on a non-dividend-paying stock when the stock price is $40, the strike price...

Consider an option on a non-dividend-paying stock when the stock price is $40, the strike price of $38, the risk-free interest rate is 10% per annum, the volatility is 35% per annum, and the time to maturity is five months.

1. What is the price of the option if it is a European call?

2. What is the price of the option if it is a European put?

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SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE

jeff jeffy answered 1 year ago

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