Question $3$

The spot rate is currently TL$32/$$$.$ Over the next $3-$month it is expected to go up by $10\%$ or

down by $8\%.$ The risk$-$free $TL$ interest rate is $40\%$ per annum quarterly compounding. $3-$month

futures exchange rate is TL$34\mathrm{.}68/$$$.$ With respect to the binomial pricing approach;

a$.$ What is the value of a $3-$month European call option with a strike price of TL$33$ per $$?$

b$.$ What is the value of a $3-$month European put option with a strike price of TL$33$ per $$?$