The initial stock price is $100. The stock moves up each period by a factor of 1.3
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The initial stock price is $100. The stock moves up each period by a factor of 1.3 and down by a factor of 0.8. If the simple interest rate per period is 1%, find the prices of three-period European and American puts, and so identify the early exercise premium amount.
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Pricing European and American Put Options In this scenarioyouve provided the following information Initial stock price S0 100 Up factor u 13 Down fact...View the full answer
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