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On October 2, 2018, Tesla stock was trading $305.65. There are options on Tesla stock, Below are the yarigble inputs you require. Using the Black-Scholes-Merton model and Solyer, solve for the implied volatility that causes the option to be valued at $44.25. The appropriate risk free rate c.c. is 0.85%. These are European Options. Underlying So Call or Put Strike 306.65 Put 300.00 10/2/18 3/15/19 Today Maturity Time to Expiration Volatility Risk Free Rate 59.52% 0.85% #N/ A #N/A #N/A #N/A N(d1) N(d2) 1 Option Premium #N/ A Using Put-Call Parity Solve for the Value of the $300.00 strike call given the information above. #N/A Confirm your calculation from Put-Call parity with the Black-Scholes-Merton formula #N/A

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3Input Data 4 Stock Price now (P) 5 Exercise Price of Option (EX) 6 Number of periods to Exercise in years (t) 306.65 300 0.449315068 0.85% 59.74% 10/2/2018 3/15/2019 Compounded Risk-Free Interest Rate (nf) 8 Standard Deviation (annualized σ) 10 11 Output Data 12 Present Value of Exercise Price (PV(EX) 13 otA.5 14 d1 15 d2 16 Delta N(d1) Normal Cumulative Density Function 17 Bank Loan N(d2)*PV(EX) 18 19 Black Scholes Merton Value of Call 20 Value of Put 21 Put Call Parity Value of Call 298.8564 0.4005 0.2645 0.1360 0.6043 133.2690 52.0427 44.2491 52.04266196

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