Write the Black-Scholes formula for a European call option: C = S·N(d₁) - K·e^(-rT)·N(d₂)

d₁ and d₂ are in Black-Scholes: d₁ = [ln(S/K) + (r + σ²/2)T] / (σ√T), d₂ = d₁ - σ√T

d₁ = [ln(S/K) + (r + σ²/2)T] / (σ√T), d₂ = d₁ - σ√T

the Black-Scholes formula prices

How do you price a gamble on a stock's future price?

Black–Scholes model

How can you predict the price of an option?

Lattice model (finance)

How can you price an option that doesn't expire?

Real options valuation

Why can't we always predict the future in business?

put-call parity states: C - P = S - K·e^(-rT)

Ever wondered how options and futures can be linked?