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Puu P Pdu = Pud Pdd 19. Uber (ticker: UBER) recently raised $8.1 billion in its public stock offering (IPO) and is now valued at
Puu P Pdu = Pud Pdd 19. Uber (ticker: UBER) recently raised $8.1 billion in its public stock offering (IPO) and is now valued at over $75 billion. The IPO price was $45 and now the stock is trading at $41.75. UBER pays no dividends. Consider a two-month American put option on UBER with a strike price of $45. Assume the continuously compounded annual risk-free interest rate r = 5.35% and the volatility o = 0.34. In this problem we use a two-period binomial model where each time period is one month (h = z) and the stock price moves according to: u=etovh d=e-ovh Compute numerical values for the American put option prices at each of the 6 nodes shown in the the binomial tree above, rounding each option price to 2 decimal places. What is the value for Puu? Please round your answer to to 2 decimal places
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