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Bonds worth 50 today having yearly return of R=0.04. Shares linked to the top 10 largest Artifical Intellingence companies (10BestAI) having value today 42, whose
Bonds worth 50 today having yearly return of R=0.04. Shares linked to the top 10 largest Artifical Intellingence companies (10BestAI) having value today 42, whose yearly return can be modelled using a binomial model having yearly returns U=0.40 and D=0.30 with probabilities p=0.6 and q=0.4, respectively. Using a 3-step binomial model, find the premium of an American put option whose underlying asset is the 10 BestAl stock, having strike price 50 and expiry time in 3 years
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