QUESTION 4 [25 Marks] A stock is currently trading at $50. The risk free interest rate is 4.5%. In nine months, analysts believe that share price will either be $60 or $45. A. Using both the Delta (Binomial) method and the Risk Neutral method, find the value of a 9-month Put option with strike price of $52. (14 Marks) B. Using the Put-Call Parity, determine the value of a Call option with the same strike price and maturity? (4 Marks) C. What is the intrinsic value of the put option that you valued in part (A)? The time value? What about the intrinsic and time values of the call option that you valued in part (0)? (5 Marks) D. Would you expect that the value of the Put option that you calculated in part (A) would be higher or lower if the difference between the higher and lower possible stock prices was smaller? Why? (Hint, no calculations are necessary for this part) (2 Marks)