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CFA Level I Valuing a Derivative Using a One-Period Binomial Model question

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Derivatives

Valuing a Derivative Using a One-Period Binomial Model

In a one-period binomial model, a stock's price can move up by a factor of 1.30 or down by a factor of 0.90 over the period, and the risk-free rate for the period is 4.0%. The risk-neutral probability of an up move is closest to:

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