One of Modular Products (MP)customers Would Like to Obtain a 6-Month

Multiple Choice

One of Modular Products (MP) customers would like to obtain a 6-month option to purchase 500,000 tables for $119 each.These tables currently sell for $110 each.Assume u equals 1.0994 and d equals .9096.What price should MP charge for this option if the annual risk-free rate is 3.2 percent? Round your answer to the nearest $100.

A) $338,400
B) $421,900
C) $598,100
D) $479,900
E) $533,600