b) As you may observe from the plot, the time value of the call option is always positive. Prove analytically that a Eur

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b) As you may observe from the plot, the time value of the call option is always positive. Prove analytically that a Eur

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B As You May Observe From The Plot The Time Value Of The Call Option Is Always Positive Prove Analytically That A Eur 1
B As You May Observe From The Plot The Time Value Of The Call Option Is Always Positive Prove Analytically That A Eur 1 (38.66 KiB) Viewed 27 times
b) As you may observe from the plot, the time value of the call option is always positive. Prove analytically that a European call option on a non-dividend- paying stock always has a positive time value. Hint: You can prove that C > max(S – K,0) where C is the call option price.
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