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Assume the riskless rate is 3 . 8 % . A stock sells for $ 8 5 , and in one year it will either
Assume the riskless rate is A stock sells for $ and in one year it will either in value to $ or fall in value to $
a points Find the value of a $ call using the binomial model.
b points Calculate the value of the call using risk neutral valuation.
c points Calculate the value of a $ put using both the binomial model and putcall parity.
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