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Miller stock trades at $20 per share and the company won't pay dividend. In each of the following two years, the stock price will either
Miller stock trades at $20 per share and the company won't pay dividend. In each of the following two years, the stock price will either go up or go down by 25% with equal probability. The risk-free continuously compounding annual interest rate is 5%. Use binomial option pricing model, what is the price of an American put option with strike price of $20 and with two years to expiration?
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