A stock is trading at $50 and we assume a one-period binomial tree model where the stock can either increase to 56 with probability p = 0.75, or falls to 45 with probability 1-p = 0.25, in the next six months. The continuous compounding interest rate is 6% per year. In this model, the value today of a six-month European call option with a strike K = $52 is: 2.765 1.698 . 3.186 2.302