Question: You are using a two-step binomial tree to estimate the price of a call option on MCD. The strike price of the call option is

You are using a two-step binomial tree to estimate the price

You are using a two-step binomial tree to estimate the price of a call option on MCD. The strike price of the call option is $22. The price of MCD today is $32. The risk-free rate is 5%. What is the price of the call? Round your solution to the nearest three decimals if needed (i.e. 2.312). Please do not type the \$ symbol. u=2 d=0.7

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