A call option is offered on a stock the option has an


A call option is offered on a stock; the option has an expiration of 55 days and a strike price of $50. The underlying stock to the call option trades for $33.15. The volatility of the stock is 30% per year, and the risk-free rate is 1.5% per year. a) Value the call option. b) If the stock price increases to $65.00, and everything else stays the same, what is the new value of the call option?

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Financial Management: A call option is offered on a stock the option has an
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