A stock trades for

$44

per share. A call option on that stock has a strike price of

$55

and an expiration date

six

months in the future. When the volatility of the stock's returns is 30%, the Black and Scholes value of the option is $3.82. Now assume, the volatility of the stock's returns is

42%,

and the risk-free rate is

3%.

Intuitively, would you expect this to cause the call price to rise or fall? By how much does the call price change?

The Black and Scholes value of this call option is

$