1.The current price of a non-dividend-paying stock is $30. Over the next six months it is expected to rise to $36 or fall to $26. Assume the risk-free rate is zero. What, to the nearest cent, is the price of a put option with the strike price of $32?

2.A stock price is currently $30. During each two-month period for the next four months it is expected to increase by 8% or decrease by 10%. No dividend payment is expected during these two periods. The risk-free interest rate is 5% per annum. If you use a two-step tree to do the valuation, what, to the nearest cent, is the value of a European put option with a strike price of $32 that expires in four months?

3.In question 2 above, what, to the nearest cent, is the value of a American put option with a strike price of $32 that expires in four months?