1. The 1-year $45 options on Logan stock are priced at $2.51 for the call and $1.58 for the put. The annual risk-free rate is 2.0 percent. What is the per share price of the underlying stock?
a $45.05
b $38.27
c $44.03
d $50.18
e $54.72
2. Concord's stock is currently selling for $40.00 a share but is expected to decrease to either $36 or $44 a share over the next year. The risk-free rate is 3 percent. What is the current value of a 1-year call option with an exercise price of $40?
a $0.98
b $1.73
c $2.52
d $0.56
e $3.10 5 points