Question
Suppose the exchange rate is $1.16/A$. Let r $ = 7%, r A$ = 2%, u = 1.31, d = 0.80, and T = 1.
| Suppose the exchange rate is $1.16/A$. Let r $ = 7%, r A$ = 2%, u = 1.31, d = 0.80, and T = 1. Using a 2-step binomial tree, calculate the value of a $1.20-strike American put option on the Australian dollar. Option C is correct, but how? Can you provide solution for Excel? formulas and steps or actual excel work sheet please? | |||||||||||
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Fundamentals Of Futures And Options Markets
Authors: John C. Hull
4th Edition
0130176028, 9780130176028
