Find the price of american call option on stock with strike

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The current price of a stock is S110. The annual continuously compounded interest rate is 0.10, and the stock pays continuous dividends at the contin uously compounded yield 0.08. The annualized standard deviation of the continuousy compounded stock return is 0.32. Using a three-period bino- mial pricing model, find the price of an American call option on the stock with strike price $100 and that matures in nine months.

Reference no: EM131894446

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