Question: Could you please solve number 5 using excel 3) Company A had just paid a dividend of 4$ per share. It is expected to have

Could you please solve number 5 using excel Could you please solve number 5 using excel 3) Company A had

3) Company A had just paid a dividend of 4$ per share. It is expected to have a dividend growth of 35% in the next five years, and 6% afterwards. Assuming 9% equity rate of return, what would be the equity price today? Questions 4-6 Binomial option pricing and risk-neutral probability Suppose company B stock is last time traded at 68.23$, and our analysis shows that in one year from now, its price would either increase or decrease by 25%.(i.e. d=0.75, u=1.25) Assume that risk-free rate is 2.5% and the company pays no dividend in this time period. 4) What would be the payoff for a long position on European Call Option written on Company B equity, with time to maturity of 1 year, and strike price of 75$? Calculate the payoff for the up and down scenarios. 5) Find the replicating portfolio of underlying stock and zero coupon bond (with 1$ face value) that has the same payoff of the option specified in question 3

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