Problem 8-6 “DEAR TUTOR THIS PROBLEM WAS ALREADY ANSWERED BUT THE ANSWER WAS WRONG, CAN YOU DOUBLE CHECK THE CALCULATIONS, THE ORIGINAL CALCULATION IS ATTACHED ON A WORD DOCUMENT, WILL HAVE TO USE ONE OF MY CREDITS? THANK YOU FOR YOUR HELP”Binomial ModelThe Single-Period Binomial Option Pricing Approach The current price of a stock is $19. In 1 year, the price will be either $26 or $16. The annual risk-free rate is 5%. Find the price of a call option on the stock that has a strike price is of $23 and that expires in 1 year. (Hint: Use daily compounding.) Round your answer to the nearest cent. Assume 365-day year.
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