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Indifferent between exercising your american call option

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Reference no: EM131473040

You have an American call option on Johnnies Inc. Your option expires in 9 months and has a strike price of $15. Currently the stock is selling for $20 and the risk-free rate for any period up until one year is 5.5% per annum with continuous compounding. You suspect a dividend will be paid in 6 months. What dividend will make you indifferent between exercising your American call option and not exercising your option?

Reference no: EM131473040

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