Since investors tend to dislike risk and like certainty, the more volatile a stock, the less valuable will be an option to purch
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Answer:
$241
Explanation:
Of the six month tenor of the note, the period that falls into 2017 is 2 months (that is, November 1 to December 31). In addition, by default, interest rates are stated on an annual basis except indicated otherwise. Therefore, it is assumed that 8.5% rate indicated in the question is an annual rate.
The computation of the interest that falls into 2017 is as follows:
=
= $17,000 * 8.5% * 2/12
= $240.83
= approx. $241.