The value of an option can be calculated by using a step-by-step approach in the case of single periods or by using sophisticated formulas that can be easily created through a spreadsheet. In the real world, two possible outcomes for a stock price in six months is an assumption. The stock markets are volatile, and stocks move up and down based on market- and firm-specific factors. Use the following formula to calculate the value of any call option within the same time period. To use the formula for different call options, you can solve this formula with algebra or program it into a spreadsheet. V_C = Cu{[l + (r_RF/365)365/(t) _ d] + C_d{U - [1 + (r_RF/365)^365/(t)]}/{1 + (r_RF/365)]^365/(t) Based on your understanding of the binomial option pricing model, is the following statement true or false? Pi_U is the price of an option that will return $1 if the price of the underlying stock goes up and $0 if the price of underlying stock goes down. False True