The current stock of a stock is 20 in one year the price, Financial Management

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The current stock of a stock is 20 in one year the price

The current stock of a stock is $20. In one year the price will be either $26 or $16, the annual risk-free rate is 5%. Find the price of a call option on the stock that has a strike price of $21 and that expires in 1 year (hint: use daily compounding)

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Financial Management: The current stock of a stock is 20 in one year the price

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Financial Management: The current stock of a stock is 20 in one year the price

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