Question
The price of a stock is currently $37. Over the course of the next year the price anticipated to rise to $44 or decline to
The price of a stock is currently $37. Over the course of the next year the price anticipated to rise to $44 or decline to $39 if the upside has a 65% probability of occurring and the risk free interest rate if 3%. What is the price of a one year call option with an exercise price of 38 using the binomial model?
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Economics For Investment Decision Makers
Authors: Sandeep Singh, Christopher D Piros, Jerald E Pinto
1st Edition
1118111966, 9781118111963
