Question: - Consider a two-period binomial model with u = 1.10 and d = 0.90 and R = 1.07. Suppose the initial stock price is 100

- Consider a two-period binomial model with u = 1.10 and d = 0.90 and R = 1.07. Suppose the initial stock price is 100 and no dividends are paid. What is the early-exercise premium of a two-period American put option with a strike price of K = 95?

A. $ 1.43

B. $ 2.43

C. $ 0.43

D. $ 0

- ABC stock is currently at 100. In the next period, the price will either increase by 10% or decrease by 10%. The risk-free rate of return per period is 2%. What is the delta of a 95strike put option?

A. - 0.75

B. + 0.50

C. - 0.25

D. + 0.25

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