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Blackscores pricing model

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › Blackscores pricing model

  • This topic has 1 reply, 2 voices, and was last updated 9 years ago by John Moffat.
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  • April 18, 2016 at 7:15 am #310910
    mtikama
    Member
    • Topics: 5
    • Replies: 3
    • ☆

    Hi John,
    I did not indicate the topic. However the question remains the same. If given a NPV of -2,000,000 and an investment outlay of $20,000,000 what would be Pa and Pe when all variables are given.

    April 18, 2016 at 8:32 am #310988
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54659
    • ☆☆☆☆☆

    I assume you mean Black Scholes pricing 🙂

    Pe = 20M and Pa = 18M (if the NPV is – 2M then the PV of the returns must be 18M)

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