2.

a)

b)

these questions are based on the question 2. kindly answer it one by one.

2. Consider returns as follows and assuming that S(O) = RM45, compute the possible stock prices in a three-step economy and sketch a tree of price movements: Scenario 10% 5% -10% 5% 10% 10% 5% -10% 10% W3 2. Consider returns as follows and assuming that S(O) = RM45, compute the possible stock prices in a three-step economy and sketch a tree of price movements: Scenario 10% 5% -10% 5% 10% 10% 5% -10% 10% W3 2. Consider returns as follows and assuming that S(O) = RM45, compute the possible stock prices in a three-step economy and sketch a tree of price movements: Scenario 10% 5% -10% 5% 10% 10% 5% -10% 10% W3 2. Consider returns as follows and assuming that S(O) = RM45, compute the possible stock prices in a three-step economy and sketch a tree of price movements: Scenario 10% 5% -10% 5% 10% 10% 5% -10% 10% W3 2. Consider returns as follows and assuming that S(O) = RM45, compute the possible stock prices in a three-step economy and sketch a tree of price movements: Scenario 10% 5% -10% 5% 10% 10% 5% -10% 10% W3 2. Consider returns as follows and assuming that S(O) = RM45, compute the possible stock prices in a three-step economy and sketch a tree of price movements: Scenario 10% 5% -10% 5% 10% 10% 5% -10% 10% W3