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A stock with a current price of $300, can go either up by 25%, or down by 20%. You have the opportunity to buy an
A stock with a current price of $300, can go either up by 25%, or down by 20%. You have the opportunity to buy an American call option on this stock for $65, which matures at the end of two periods, with an exercise price of 275. a- Please draw the trees of the stock and option values b- What is the price of the call option today if the risk free rate is 8%. What is your decision for this investment opportunity? Explain your
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