Let's add some dividends to the binomial model. We will have three times = 0, 1, 2. Time periods are of length = 1, the stock starts at 0 = $100, and risk-free zero rates are always = 0.02. At each time, the stock goes up by a factor of = 1.1 or down by a factor of = 1.11, with probability 65% of it going up and 35% of it going down