The current stock price is $100, the exercise price is
$105.1271, the risk-free interest rate is 5
percent (continuously compounded), the volatility is 30 percent,
and the time to expiration is
one year (365 days).
a. Using the BSM model, compute the call and put prices for a
stock option.
b. In the previous question (3a) you should get the same price
for the call and the put, or very
similar (the differences are due to the rounding of the...