Lognormal confidence interval

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Reference no: EM131850412

You are given the following information for a stock that pays dividends continuously at a rate proportional to its price.

(i) The current stock price is 0.25.

(ii) The stock's volatility is 0.35.

(iii) The continuously compounded expected rate of stock-price appreciation is 15%.

Calculate the upper limit of the 90% lognormal confidence interval for the price of the stock in 6 months.

Reference no: EM131850412

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