Introduction to Corporate Finance
8: Options Why are the probabilities of no concern to us? There are two answers to this question. The first is that the market s ...
ParT 2: ValuaTION, rISk aNd reTurN 8-4b THe BlaCk–SCHOleS MOdel In 1973, Fischer Black and Myron Scholes published what might fa ...
8: Options When you first encounter it, the Black–Scholes option pricing equation looks rather intimidating. As a matter of fact ...
ParT 2: ValuaTION, rISk aNd reTurN What about the term Xe-rt? Recall from our discussion about continuous compounding, in Chapte ...
8: Options present value of the exercise price, adjusted for the probability that when the option expires, the share price will ...
ParT 2: ValuaTION, rISk aNd reTurN 10 To value options using the binomial method, is it necessary to know the expected return on ...
8: Options 8-5b WarraNTS aNd CONVerTIBleS Warrants are securities that are issued by companies and that grant investors the righ ...
ParT 2: ValuaTION, rISk aNd reTurN a result of the warrants being exercised, then the price of the warrants equals the price of ...
8: Options At the time Microsoft issued these bonds, its shares were selling for $25.11 per share. Holding the price of the bond ...
ParT 2: ValuaTION, rISk aNd reTurN Effectively, the call option that companies retain allows them to shorten the conversion opti ...
8: Options Now, a pilot program (or market test) is not a novel idea; but its use tells us something about choices that we now s ...
ParT 2: ValuaTION, rISk aNd reTurN IMPOrTaNT eQuaTIONS 8.1 S + P = B + C 8.2 C = SN(d 1 ) – Xe-rt N(d 2 ) 8.3 = ++ σ ...
8: Options ST8-1 Several call options on Cuban Cigars Inc. are available for trading. The expiration date, strike price and curr ...
ParT 2: ValuaTION, rISk aNd reTurN Strike Call Put $20 37 50 P8-2 The shares of Spears Entertainment currently sell for $28 each ...
8: Options QUALITATIVE ANALYSIS OF OPTION PRICES P8-9 Examine the data in the table below. Given that both shares trade for $50 ...
ParT 2: ValuaTION, rISk aNd reTurN You have recently spent one of your Saturday afternoons at an options seminar presented by De ...
REAL-WORLD CASE STUDY This is a short case which brings together several of the financial issues that we have been discussing in ...
SHarING YOur OWN BuSINeSS keY daTeS OF THe OFFer Description Date Prospectus lodgement with ASIC 31 March 2015 Noteholder exchan ...
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I Introduction 1 Corporate finance scope 2 Financial statements 3 Time value of money V Special Topics 16 Financial planning 17 ...
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