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You are given the following data




You are given the following data on call and put premia in cents per share for;company ABC's shares, currently priced at 425 cents each. Each contract refers to 1000 shares.;Call Premia Call Premia Call Premia Put Premia Put Premia Put Premia;Strike Prices April June September April June September;420 22 31 34 14 20 27;460 6 12 15 39 42 48;(a) (5 points) List all the call and put premia that are `out of the money'.;(b) (5 points) Explain your intuition as to why the premia rise between April and September.;(c) (5 points) Which of the options above has the lowest time value?


Paper#27468 | Written in 18-Jul-2015

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