Problem

5. In a binomial framework, if the risk-neutral probability on the up branch is given as p...

5. In a binomial framework, if the risk-neutral probability on the up branch is given as p = 0.8956, the risk-free rate per period is 2%, and the down move is the reciprocal of the up move, then, given a current stock price of $100, what are the two prices a period from now?

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Solutions For Problems in Chapter 11