Question: Consider a one step binomial model. The initial stock price is S0 = $80. There is a 60% chance the stock price will rise to

Consider a one step binomial model. The initial stock price is S0 = $80. There is a 60% chance the stock price will rise to $90, and a 40% chance it will fall to $75. The risk-free interest rate is 5%.

QUESTION: Identify u and d

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