Question: Consider three call options identical in every respect except for the maturity of 0.5, 1, and 1.5 years. Specifically, the stock price is $100, the

Consider three call options identical in every respect except for the of 0.5, 1, and 1.5 years. Specifically, the stock price is $100, the annually compounded risk-free rate is 5 percent, and the is $100. Use a one-period binomial model with u = 4/3 and d = 3/4? Calculate p and h. Explain.

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