Approximate prices of American put option with X=20 and American call option with X=20 using 5-step...

 

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Approximate prices of American put option with X=20 and American call option with X=20 using 5-step binomial trees. For the estimate of volatility use implied volatility from part b. Please, provide your u, d, p, stock tree, and option tree. Approximate prices of American put option with X=20 and American call option with X=20 using 5-step binomial trees. For the estimate of volatility use implied volatility from part b. Please, provide your u, d, p, stock tree, and option tree.

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To approximate the prices of an American put option and an American call option using a 5step binomial tree we need to make some assumptions and follo... View the full answer