Business, 22.06.2021 17:30, jaxondbagley

You are attempting to value a call option with an exercise price of $109 and one year to expiration. The underlying stock pays no dividends, its current price is $109, and you believe it has a 50% chance of increasing to $142 and a 50% chance of decreasing to $76. The risk-free rate of interest is 12%. Calculate the call option's value using the two-state stock price model.

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You are attempting to value a call option with an exercise price of $109 and one year to expiration....