Question: Hi, needed help on this question please. 'i. A stock price is currently 50. Over each of the next two 6-month periods, it is expected

Hi, needed help on this question please.

'i. A stock price is currently 50. Over each of the next two 6-month periods, it is expected to go up by 10 or down by 10. The riskfree interest rate is 20% per annum with semi- annual compounding. (8) Suppose instead that over each of the next two 6month periods, the stock price can go up by 10, down by 10, or stay constant. How would you determine the value of the 1year European call? A qualitative answer will suffice for this question. Suppose 6 months have gone by, the riskfree interest rate is still 20% per annum with semiannual compounding, and the price of the stock is 60. Over the next 6 months, the stock price can go up by 10, down by 10, or stay constant. A cash- ornothing digital call option with 6-month maturity, strike price 62 and cash payment 30 trades at 19.09. What is the noarbitrage price of a European call expiring in 6 months with strike price 55

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