Anyone has any idea about the questions? This is related to option pricing, you might use martingale to value the stock....
But I don't know how to do it as it is not even a binomial tree....
If a stock model happens to have the parameters u=1.134, d=0.8, p=0.6, and S 2 =6.38,
4.25, or 3.2, then when the nodes of the stock tree are filled in, we obtain the original
stock prices. Explain why this is true.
Help!