A European option on a stock with a known dollar dividend is valued by setting the stock price variable equal to the stock price minus the present value of the dividend in the Black-Scholes-Merton formula
A second price can be obtained using the tree building procedure in the chapter. Which of the following is true when a very large number of time steps are used in the tree?
A. The first price is higher than the second price
B. The first price is lower than the second price
C. The first price is sometimes higher and sometimes lower than the second price
D. The two prices are almost exactly the same
D
The two prices are exactly the same because they are based on treating dividends in the same way.
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The amount of variance a variable shares with all other variables included in the factor analysis is referred to as ________
A) communality B) total variance C) shared variance D) percentage of variance
A company has interest expense of $52,000, income taxes expense of $121,000, and net income of $281,000. The company's times interest earned ratio equals:
A. 5.40. B. 2.33. C. 7.73. D. 8.73. E. 0.11.
What is the only real way to increase wages and standard of living?
a. increase quality b. increase competition c. increase trade d. increase productivity
If you have total annual cost (TAC), total annual setup cost (TASC), total annual holding cost (TAHC), and total annual materials purchase cost (TAMPC), then you can calculate total annual stock-out cost (TASOC) by this formula.
a. TASOC = TAC – TASC – TAHC – TAMPC b. TASOC = TAC + TASC – TAHC – TAMPC c. TASOC = TAC + TASC + TAHC – TAMPC d. TASOC = TAC + TASC – TAHC + TAMPC