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Suppose you had a stock currently valued at $100. One period later, you estimate that the stock price will either increase by 15% (to $115) or decrease by 10% (to $90). If the one-period rate of interest is 5%, at what price would the binomial option pricing model value a call option with an exercise price of $107.50?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92102652

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