function [X] = BlackScholesMertonEuro(callput, assetP, strike, riskFree, div, tmat, vol)
%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%
% Computes the Black-Scholes-Merton European Call/Put Option Values based
% on the following inputs:
% callput           =       Call = 1, Put = 0
% assetP            =       Underlying Asset Price
% strike            =       Strike Price of Option
% riskFree          =       Risk Free rate of interest
% div		        =       Dividend Yield of Underlying
% tmat              =       Time to Maturity
% vol	            =       Volatility of the Underlying
% Please note that the use of this code is not restricted in anyway.
% However, referencing the author of the code would be appreciated.
% To run this program, simply use the function defined in the 1st line.
% http://www.global-derivatives.com 
% info@global-derivatives.com
% Kevin Cheng (Nov 2003)
%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%

z = 1;
if ~callput
    z = -1;
end

dt = vol * sqrt(tmat);                                
df = riskFree - div + 0.5 * vol ^ 2;    	             % Computes the drift term
d1 = (log( assetP / strike ) + df * tmat ) / dt;             % Calculates the d1 term used in Black-Scholes
d2 = d1 - dt;                                                % Calculates the d2 term used in Black-Scholes

% The cumulative normal distribution functions for use in computing call
% and put prices
nd1 = normcdf(z * d1);
nd2 = normcdf(z * d2);

price = z * (assetP * exp(-div * tmat) * nd1 - strike * exp(-riskFree * tmat) * nd2);

X = price;