The current price of a non-dividend paying stock is 75 use, Financial Management

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The current price of a non-dividend paying stock is 75 use

The current price of a non-dividend paying stock is $75. Use a two-step tree to value an American put option on the stock with a strike price of $72 that expires in 12 months. Each step is 6 months, the risk free rate is 5% per annum, and the volatility is 25%. What is the option price? Assume that the option is written on 100 shares of stock.

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Financial Management: The current price of a non-dividend paying stock is 75 use

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Financial Management: The current price of a non-dividend paying stock is 75 use

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