A stock that not pay any dividend is currently trading at $60. After one period, the...

A stock that not pay any dividend is currently trading at $60. After one period, the price will either increase by 20% or decrease by 20%. The risk-free rate is 8% per period (not continuously compounded). Consider a European put option on the stock with strike price of $66. Set up a replicating portfolio and price the option.

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jeff jeffy answered 1 year ago

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