(A) A stock price is currently AUD 50. It is known that at the end of two months it will be either AUD 54 or AUD 48. The risk-free interest rate is 10% per annum with continuous compounding. What is the value of a two-month European call option with a strike price of AUD 49? (i) Use no-arbitrage arguments in the context of stock-bond replicating portfolio. (04 marks) (ii) Now apply one step Binomial model to price the option. (02 marks) (iii) In a risk-neutral world, what are the two features that simplify the pricing of derivatives? (01 mark)