Question: Please show all work so I can learn. Thanks! A company stock is currently trading at 50 . Over the next year, this stock will

Please show all work so I can learn. Thanks!

A company stock is currently trading at 50 . Over the next year, this stock will either increase in value by 10% or decrease by x%. The effective risk-free rate is 4%. The value of a one-year European put option for this stock at an exercise price of 50 is 1.28.

Calculate x

___________________

A) 0

B) 2

C) 4

D) 6

E) 8

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