Use the binomial method to answer a and b what is the value, Financial Management

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Use the binomial method to answer a and b what is the value

A stock is currently selling for $40. Over the next six months the stock price is expected to go up by 10% or down by 10%. The risk-free interest rate is 12% per annum with continuous compounding.

Use the binomial method to answer (a) and (b). What is the value of a 6-month put option with a strike price of 42?

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Financial Management: Use the binomial method to answer a and b what is the value

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