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We apply an exponential time integration schemecombined with a central difference scheme on a piecewise uniform mesh withrespect to the spatial variable to evaluate a generalized Black-Scholes equation. We show that the scheme is second-order convergent for both timeand spatial variables. It is proved that the scheme is unconditionally stable.Numerical results support the theoretical results

Exponential Time Integration and Second-Order Difference Scheme for a Generalized Black-Scholes Equation