A one-month American call on a non-dividend paying stock sells for $5 when the initial stock price is $45 and one-month interest rates are at 6%.

A one-month American call on a non-dividend paying stock sells for $5 when the initial stock price is $45 and one-month interest rates are at 6%. A month later a different one month American call on the same non-dividend paying stock with the same exercise price sells for $4 when the stock is selling for $45 and one-month interest rates are still 6%.

Assuming no arbitrage opportunities, how can this be?

"Our Prices Start at $11.99. As Our First Client, Use Coupon Code GET15 to claim 15% Discount This Month!!":

Get started