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Consider a two-period binomial model in which a share currently trades at a price of R160....

Consider a two-period binomial model in which a share currently trades at a price of R160. The share price can go up or down by 10% each period. The risk-free rate is 7 percent. Calculate the price of the European call and American put options expiring in two periods with an exercise price of R145 and R148 respectively.

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jeff jeffy answered 1 year ago
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