Given the following information calculate the theoretical


Given the following information, calculate the theoretical intrinsic value of the Call option using the Black Scholes Model. IF the market price for the Call option = $11, should the investor buy?

S = 14 = Stock Price

X = 16 = Exercise or Strike Price

r = 0.05 = Risk Free Rate

T = 0.25 = Time to Maturity (as a fraction of one year)

N(d1) = 0.1469

N(d2) = 0.1230

 

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Finance Basics: Given the following information calculate the theoretical
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