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What is the value of the call option

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Reference no: EM132074991

Stock price will be either $79 or $101 at the end of the year. Call options are available with one year to expiration. T-bills currently yield 4 percent.

Suppose the current price of the company's stock is $90. What is the value of the call option if the exercise price is $85 per share?

Reference no: EM132074991

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