Assume S = $50, K = $45, δ = 0.02, r = 0.08, σ = 0.20, and 5…
Assume S = $50, K = $45, δ = 0.02, r = 0.08, σ = 0.20, and 55 days until expiration. A) What is the price of a knock-out put option with a barrier of $48?B) What is the price of a knock-in put option with a barrier of $48?