The current share price of company a is 10 the annual, Financial Management

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The current share price of company a is 10 the annual

The current share price of Company A is $10. The annual sdandard deviation of the share price is 0.18. The continuously compounded annual risk-free rate 4%.

a) What is the risk-neutral probability of an up move?

b) Compute the value of a two - year American put option with stake price of $12

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