Question: 32. Consider a two period, two scenario world where a stock price is $45, the risk-free rate is 5% and the stock can either go

32. Consider a two period, two scenario world where a stock price is $45, the risk-free rate is 5% and the stock can either go up 20% or down 20% over one year. A call option expiring at the end of the second period has an exercise price of $40. (a) Use the two period binomial model to calculate the value of the call at T=0. (b) Calculate h at T=0. (c) Calculate h at T=1

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