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We model the movement of stock prices using a Binomial tree. Each branch of the tree spans a time horizon of 4 months. The proportional

We model the movement of stock prices using a Binomial tree.

Each branch of the tree spans a time horizon of 4 months.

The proportional up movement on the tree (u) is 1.79.

What is the volatility of the stock implied by u?

If your answer is (say) 40%, enter 0.40.

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