Question: 2. Please refer to the following binomial lattice term structure model, and then answer the following questions. 11.72% 9.38% 8.44% 7.5% 6.75% 6.08% P

2. Please refer to the following binomial lattice term structure model, and

2. Please refer to the following binomial lattice term structure model, and then answer the following questions. 11.72% 9.38% 8.44% 7.5% 6.75% 6.08% P 6.0% 5.4% (1-p) 4.86% 4.37% The upper probability is: p=0.5 Compute P.2], which is the Arrow-Debreu security, paying 1 dollar at time 3 and state 2 (refer to the node with interest rate 8.44% on the graph). Round your answer to the fourth decimal place.

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