A stock is currently S=20. Over the next year, it is expected to go up...
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A stock is currently S=20. Over the next year, it is expected to go up by 25%(u=1.25) or down by 20%(d=0.8). The risk- free interest rate is r=5% per annum with continuous compounding. What is the value of a 1 year european put option with a strike price k=20
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