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Consider a two-period two-state world let the current stock

Consider a two-period, two-state world. Let the current stock price be $35 and the risk-free rate be 5%. In each period, the stock price can either go up by 10% or down by 10%. A call option expiring at the end of the second period has an exercise price of $30.

1. What is the current price of the call?
2. What is the initial hedge ratio?

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Finance Basics: Consider a two-period two-state world let the current stock

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