Use the Following Tree to Answer the Questions That Follow

question 3

Multiple Choice

Use the following tree to answer the questions that follow.
-What are the forward rates f(1,1) in the up and down nodes?

• A) 0.0307,0.0402
• B) 0.0102,0.0010
• C) 0.0102,0.0102
• D) 0.0056,0.0056
• E) 0.0354,0.0056

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Definitions:

Millions

A numerical unit representing one thousand thousand, or 1,000,000, often used to quantify currency, population, or other large-scale counts.

Net Working Capital

The difference between a company's current assets and its current liabilities, indicating short-term financial health and liquidity.

Operating Cash Flow

Cash generated from the normal business operations of a company, excluding capital expenditures and investment income or expenses.

Comprehensive Income

A measure of all changes in equity of a company that result from recognized transactions and other economic events of the period, excluding transactions with owners in their capacity as owners.