Find probability that call option on stock with strike price

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Reference no: EM132809883

Problem 1: One stock is currently selling for $ 100. The stock pays dividends at a 3% continuous compound annual yield. The annual rate of return on stocks is 15% and the annual standard deviation is 30%. Find the probability that a call option on the stock with a strike price of $ 125 will expire "in the money" within two years.

Reference no: EM132809883

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