Solutions in code or Excel Consider the following option: Stock price =100 Strike K=95 Volatility =20% Expiry T = 3 months Dividend yield = 2% Stock expected return = 6% Risk free = 3%

1) Calculate price of European call a. (20 points) Binomial tree b. (20 points) Finite difference method c. (20 points) Black Sholes-Gaussian Distribution d. (20 points) Black Scholes- Monte Carlo

2) (20 points) Calculate price of American call