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Excel Online Structured Activity: Binomial Model The current price of a stock is $22. In 1 year, the price will be either $27 or $14.

Excel Online Structured Activity: Binomial Model

The current price of a stock is $22. In 1 year, the price will be either $27 or $14. The annual risk-free rate is 3%.

Find the price of a call option on the stock that has a strike price is of $25 and that expires in 1 year. (Hint: Use daily compounding.) Assume 365-day year. Do not round intermediate calculations. Round your answer to the nearest cent.

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