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NEW QUESTION: 1
The MAIN objective of identifying and evaluating risk at each software development life cycle (SDLC) stage is to reduce the:
A. acceptance test time
B. development time
C. number of software security controls
D. mitigation costs.
Answer: D
NEW QUESTION: 2
A distributor provides customer service by improving which of the following market driven factors?
A. Design
B. Quality
C. Availability
D. Shelf life
Answer: C
NEW QUESTION: 3
The basic formula for the Black-Schools Option Pricing Model essentially refs is The difference between the expected present value of the final stock price and the present value of the exercise price.
An entity wishes to price a call option written on a nondividend-paying stock using the Black-Scholes Option Pricing Model. The current stock price is US $50, the exercise price is US $48. The risk-free interest rate is 5.0%, the option expires in 1 year, and the cumulative probabilities used to calculate the present values of the final stock price and the exercise price are 65 and 58 respectively. If the value of et-n) is .9512. the current value of the call option is:
A. US $4.66
B. US $6.02
C. US $2.00 Answer
D. US $4.02
Answer: B
Explanation:
C is the current value of a call option with time t in years until expiration, S is the current stock price. N di is the cumulative probability that ai deviation less than di will occur in a standardized normal distribution [N di) is an area to the left of d under the curve for the standard normal distribution], E is the call's exercise price. e is a constant approximately 2.7183), and r is the annualized continuous risk-free rate of return. Thus, the value of the call is: