Black Scholes option analysis — OpenTuition Forums

Mmaureenw15y ago

I am using the BPP study text for exams in 2011. On page 215 I cannot figure out what they mean when they say one should use the normal distribution tables. They say that N (d 1) = 0.9495. From the previous calculation d 1 = 1.6424.

Can anyone assist me?

((deleted)15y ago#1

Hi Maureen

The normal distribution tables are on page 507 of the BPP study text.

To find N(1.64) you need to use the row for 1.6 and the column for 0.04 which the tables gives as 0.4495. As d1 >0 you need to add 0.5 to this number (as stated under the distribution table) which gives 0.9495

I hope this helps!

Mmaureenw15y ago#2

Thanks, I now can do this.