Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. a stock is currently s=20. over the next year, it

A stock is currently S=20. Over the next year, it is expected to go up...

60.1K

Verified Solution

Question

Finance

A stock is currently S=20. Over the next year, it is expected to go up by 25%(u=1.25) or down by 20%(d=0.8). The risk- free interest rate is r=5% per annum with continuous compounding. What is the value of a 1 year european put option with a strike price k=20

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Q

he lac operon in E. coli regulates the co-expression of three genes needed for the degradation...

Biology
Q

The activity of a sample of a radioisotope at some time is 10.1 mCi and 0.36...

Physics
Q

In its present state, IDEA 2004 has undergone several revisions since introduced as PL 92-142. As...

Psychology
Q

Prove that gcd(a,b) = gcd(a+b,lcm(a,b))

Advance Math
Q

A thin uniform rod of length is released from rest from the position shown in...

Physics
Q

esson 9 Practice Prob 1 An image of a book shown on a website is...

Geometry
Q

Susan's math teacher assigned x homework problems on Monday. On Tuesday, she assigned 13 more...

Basic Math
Q

Juana borrowed $100,000 to acquire a parcel of land to be held for investment purposes...

Accounting
Q

Houpe Corporation produces and selis a single product. Data concerning that product appear below: Fxed...

Accounting
Q

Periodic Inventory by Three Methods; Cost of Merchandise Sold The units of an item available...

Accounting
Q

When company's debt-to-equity ratio is greater than 100% than its current ratio must be greater...

Accounting
Q

One of the greatest concerns when analyzing financial statements is that liabilities of the company...

Accounting