7. Suppose that, in each period, the cost of a security either goes up by a factor of u 2 or down by a factor d 1/2. Assume the initial price of the security is $100 and that the interest rate r is 0 o). Compute the risk neutral probabilities p (price moves up) and q -1-p (price moves down) for this model. b). Sketch a diagram of this two period stock price model. c). Assuming the strike price of a European call option on this security is $90, compute the possible payoffs of the call option given that the option expires in two periods. d). What is the expected value of the payoff of the call option