Question: 1. Design an Excel sheet that prices a call option using a 6 step binomial tree. The inputs are: a. Initial Stock Price b. Strike

1. Design an Excel sheet that prices a call option using a 6 step binomial tree. The inputs are: a. Initial Stock Price b. Strike Price c. Time to Maturity d. Interest Rate (continuously compounded) e. Volatility

2. Design an Excel sheet that prices a call option using a 2 step binomial tree. Assume that there is a dividend paid at the first step of the tree. The inputs will be as in question 1, but with the addition of the dividend to be paid at the first step.

3. Design an Excel sheet that prices a call option using the Black-Scholes option pricing model. Inputs are as in question 1, but with the addition of the (continuously compounded) dividend yield.

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