A stock price is currently $65. After each two twelve-months, the price is expected to go up by or down with the volatility of 25%. The risk-free rate interest rate is 7% per annum with continuous compounding. Questions: 1) What will be the risk-neutral probability of an up move - p? (1%) 2) Please draw a two step binominal tree describing the behavior of the stock price (1%) 3) What is the value of a 2 year European Call option with a strike price of $65? (2%)