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Recalculate the value of a put option using the risk

An ordinary share is currently priced at sh 60. The price will either increase to sh 72 or reduce to sh 48 in the next six months period. The risk free rate is 6%.

Required;

Using a one step binomial tree determine the value of a put option apply the no arbitrage approach.

Recalculate the value of a put option using the risk neutral pricing approach

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Cost Accounting: Recalculate the value of a put option using the risk

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Cost Accounting: Recalculate the value of a put option using the risk

Reference No:- TGS02525537

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