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Q3: Use a two period binomial tree to price a 12 month European style put option on YMMV struck at $16. The spot price of
Q3: Use a two period binomial tree to price a 12 month European style put option on YMMV struck at $16. The spot price of YMMV is $15.25 and it pays no dividends. Assume u/d=4/3, Pup = 1/3, and r = 9.75%. = A) $1.25 B) $0.96 C) $0.72 D) $0.58 E) $1.30
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