Question: Consider a 2-period binomial model with an initial stock price of $150. Suppose during each of the 2 periods, the stock can either go up

Consider a 2-period binomial model with an initial stock price of $150. Suppose during each of the 2 periods, the stock can either go up by 16% or down by 12% (lose 12% of its value). Suppose each period is 3 months long (and there are 2 such periods), and the (annual effective) risk-free rate is 1%. What is the time 0 price of a call option with a strike price 140 and 6 months maturity?

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