Suppose that we have a stock with a price of $75. We want to price a call option using the binomial model that has a strike price of $82. We are going to use steps of 5 days and price it for 20 days, so today plus four more time steps. The stock has a volatility of 47% and the risk free rate is 1%.

What is the discounting rate?

	A.	0
	B.	.8776
	C.	.8799
	D.	.9999

Suppose that we have a stock with a price of $75. We want to price a call option using the binomial model that has a strike price of $82. We are going to use steps of 5 days and price it for 20 days, so today plus four more time steps. The stock has a volatility of 47% and the risk free rate is 1%.

What is the probability of up?

	A.	.3889
	B.	.4875
	C.	.4884
	D.	.5123