Question: . Consider the perpetual American put option when u = 2, d = 1/2, r = 1/4, K = 4 and So = 2 for

. Consider the perpetual American put option when u = 2, d = 1/2, r = 1/4, K = 4 and So = 2 for j = 2, 3, .... Show that the time zero price of the option is Vo = 22-J.

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