Value of the call option with a strike price


A stock with a current price of $25 will either move up to $32 or down to $20 over the next period. The risk-free rate of interest is 3.5%. What is the value of the call option with a strike price of $30?

a) $0.61

b) $0.72

c) $0.93

d) $1.11

e) $1.36

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Finance Basics: Value of the call option with a strike price
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