Problem 5.43 For the situation considered in Problem 5.42:

(a) Find suitable parameters of the binomial lattice model that approximates the stock price (not the option price) with a basic time period of 3 months.

(b) Draw the binomial tree for the binomial lattice model of part (a), (similar to Figure 3.8), and enter the prices of the stock after one year (at the appropriate nodes of the lattice).

(c) Compute the probability distribution of the year end stock prices and display them in the following format. s P(S = s)