Problem

24. (Difficult) Using values for u = 1.03 and d = 0.98 and an initial stock price of $50,...

24. (Difficult) Using values for u = 1.03 and d = 0.98 and an initial stock price of $50, compute and plot the final risk-neutral probability distribution of the stock price after 100 periods. The interest rate is zero. What distribution does this remind you of?

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Solutions For Problems in Chapter 12