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1. A stock with current value S(0) 200 has an expected growth rate of its logarithm of v-7% and = 20%. Find suitable parameters of

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1. A stock with current value S(0) 200 has an expected growth rate of its logarithm of v-7% and = 20%. Find suitable parameters of a binomial lattice representing this stock with a basic elementary period of 3 months. Draw the lattice and enter the node values for 1 year What are the probabilities of attaining the various final nodes? Hint: Follow example 6.2.1

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