Use a 3-period forward binomial tree to price an asian


Assume that a nondividend-paying stock is currently trading at $80. The stock has historical volatility of 25%, and the risk-free rate is 4%. Use a 3-period forward binomial tree to price an Asian arithmetic average price call with a strike of $95 and 1.5 years to expiration.

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Financial Management: Use a 3-period forward binomial tree to price an asian
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