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25 A non-dividend-paying stock, currently priced at $125 per share, can either go up by $25 or down $25 in a year. Consider a one-year

25 A non-dividend-paying stock, currently priced at $125 per share, can either go up by $25 or down $25 in a year. Consider a one-year European call option with a strike price of $135. The continuouslycompounded risk-free interest rate is 8%. Use a one-period binomial model to determine the current price VC (0) of the call option. (a) About 8.60 (b) About 9.52 (c) About 9.76 (d) About 9.81

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