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We have discussed binomial option pricing model for a call option expiring in one year. How will you expand this model to price options expiring
We have discussed binomial option pricing model for a call option expiring in one year. How will you expand this model to price options expiring in n years? Consider a European call option on stock ABC expiring in three years. Use the binomial pricing model to find the price of this option. Here are the inputs: S0 =$70, u= 1.1, d= 0.7, rf= 6%, X= $75
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