A call option has an exercise price of $30. The stock price at a point on the binomial tree is $36.24. The calculated present value of the option at that same point is $5.86. What figure should be used to calculate option prices at points moving toward the final price?
(a) $5.86
(b) $6.24
(c) $6.62
(d) $7.01
Answer: b
Fin 402
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