The following questions are related to binomial tree option pricing.F● Information about the underlying asset: spot price 100, expected return 15%,volatility 20%.● Information about the market: risk-free rate 5.00%.Consider an at-the-money American put option maturing in 1 year. Build a 3-stepCRR binomial tree (i.e. show the price changes).

American put option, we need to calculate the price changes at each step based on the given…

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MATLAB: An Introduction with Applications

6th Edition

ISBN:9781119256830

Author:Amos Gilat

Publisher:Amos Gilat

Chapter1: Starting With Matlab

Section: Chapter Questions

Problem 1P

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9. How long would it take for an investor to double hismoney at 10% interest per year, compoundedannually?include a cash flow
A stock has had the following year-end prices and dividends: Year Price Dividend 1 $ 65.03 — 2 71.90 $ .74 3 77.70 .79 4 63.97 .85 5 74.51 .94 6 86.75 1.01 What are the arithmetic and geometric returns for the stock? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)
The following problem refers to the stock table for ABC Inc. (a tire company) given below. Use the stock table to answer the following questions. Where necessary, round the dollar amounts to the nearest cent. 52-Week Yld Vol Net High Low Stock SYM Div % PE 100s Hi Lo Close Chg 80.69 45.87 ABC Inc. ABC 2.99 1.5 17 5915 58.50 57.51 58.12 +1.41 ..... a. What were the high and low prices for a share for the past 52 weeks? High price: $ Low price: $
With reference to the accounting method of amortized analysis, in what situation the sum of amortized costs may become less than the sum of real costs?
45. Use the following information regarding an equal-weighted equity index and assume that all dividend payments are made at the end of the year. Security Price at the End of 2020 Price at the End of 2021 Dividends per Share A $20 $25 $0.50 B $50 $45 $0.20 C $31.25 $36 $0.40 D $100 $135 $0.50 Note: The dollar value of the index on December 31, 2020 is $10,000 and using a divisor of 10, the index level equals 1,000. The weight of Security B in the index on December 31, 2021 before rebalancing is closest to: a. 18.55% b. 25.00% c. 19.35% d. 22.15% e. 16.75%
Calculate the missing values in the following table. Round your answers to two decimal places. List Price (L)(L) Single discount rate (d)(d) Amount of discount (d×L)(d×L) Net price (N)(N) 6.00% $51.50 % $219.50 $662.50 $12,800.00 % $640.00 $30,950.00 % $3,851.75 The net price of an item after trade discounts of 14%, 9.5%, and 1.5% is $1,241.93. a. What is the list price of the item? b. Calculate a single equivalent trade discount rate of the series of discount rates.
N4 ZZZ Limited buys a $5 million parcel of 120 day Bank Accepted Bills on a 3.6% p.a. yield and sells them 30 days later on a yield of 3.25% p.a. Required: Calculate the following for the investment made by ZZZ limited: (a)the amount of interest earned; (b)the capital gain or loss; (c)the holding period yield.
Please answer this question
2. Suppose the probability a plant is destroyed in year 1 is 2% and the probability a plant is destroyed in year 2 assuming it was not destroyed previously is 4%. When the plant is destroyed, it would cost $249219 to replace. Assumed the interest rate is 5%, what is the expected replacement cost, round to nearest dollar? You'll need to find the expected cost each year and discount them at 5%.
Kier Company issued $740,000 in bonds on January 1, Year 1. The bonds were issued at face value and carried a 3-year term to maturity. They had a 5.50% stated rate of interest that was payable in cash on December 31st. Based on this information alone, the amount of interest expense shown on the December 31, Year 1 income statement and the cash flow from operating activities shown on the December 31, Year 1 statement of cash flows would be: Interest Expense Cash Outflow A. $40,700 zero B. zero $40,700 C. $40,700 $40,700 D. zero zero Multiple Choice Choice A Choice B Choice C Choice D

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The following questions are related to binomial tree option pricing. ● Information about the underlying asset: spot price 100, expected return 15%, volatility 20%. ● Information about the market: risk-free rate 5.00%.