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Business, 19.11.2019 00:31 prince8522

You want to use the binomial tree analysis to value a 2-year american put option with an $80 strike price on crabbe and goyle corporation. the shares are currently trading for $110. the annualized continuously compounded risk-free rate is 5%. the volatility of the stock is 64%. you will use the cox ross rubenstein method for computing the binomial tree (see slide 32 of the ch. 13 notes for details). draw the binomial tree and find the value of the option using a time step of 6 months (n=4).

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You want to use the binomial tree analysis to value a 2-year american put option with an $80 strike...
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