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One period later it can go up(u) by 25% or go down(d) by 20%.
Learning Goal: I'm working on a finance exercise and need support to help me learn. Q. Consider a stock currently (S0) priced at SAR 80. One period later it can go up(u) by 25% or go down(d) by 20%. The risk-free rate is 7 percent. Calculate the current/theoretical value of the European call option if the exercise/strike price is SAR 80?

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