Suppose Caroll's stock price is currently $20. In the each next six month periods it will either fall by 50% or rise by 100%. What is the current value of a one-year call option with an exercise price of $15? The six-month risk-free interest rate (periodic rate) is 5%. [Use the two stage binomial method]
A) $8.73
B) $10.03
C) $16.88
D) $13.33

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The Answer of Suppose Caroll's stock price is currently $20. In the each next six month periods it will either fall by 50% or rise by 100%. What is the current value of a one-year call option with an exercise price of $15? The six-month risk-free interest rate (periodic rate) is 5%. [Use the two stage binomial method]
A) $8.73
B) $10.03
C) $16.88
D) $13.33

Suppose Caroll's Stock Price Is Currently $20