O words D Question 4 20 pts Use the binomial model to calculate the value of both an American put option and a European put option on a stock that pays a $5 dividend each quarter. The option expires in six months and the second dividend is paid just after the option expires (you can ignore the second dividend). The exercise price is $55. The current stock price is $60 and the annual standard deviation of stock price is 45%. This implies that the stock price may rise by 25% each quarter or the stock price may fall by 20% each quarter (up multiplier is 1.25 and down multiplier is 0.8). The risk-free rate is a quarterly 2% (ie the annual risk-free rate is 8.24%). Edit View Insert Format Tools Table 12pt Paragraph BIU A T % B MacBook Air