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Please explain your answers for both parts, thanks! Part 2 You are a dealer and are going to make a market in European put options

Please explain your answers for both parts, thanks!

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Part 2

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You are a dealer and are going to make a market in European put options on a stock trading at 110.4. The strike is 114.8 and the maturity of the option is 0.3. You know that the stock will either be at 120.6 or 104.5 in 0.3 years. Risk-free interest rates are 4% continuously compounded. What is the fair value for the option? Round your answer to 2 decimal places. 120.6 110.4

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