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For two stocks ABC and XYZ: -The current price of ABC is 30. -ABC pays continuous dividends at an annual rate of 2%. -The current

For two stocks ABC and XYZ:

-The current price of ABC is 30.

-ABC pays continuous dividends at an annual rate of 2%.

-The current price of XYZ is 75.

-XYZ pays continuous dividends at an annual rate of 5%.

-A 1-year call option to receive a share of XYZ in exchange for 2.5 shares of ABC costs 2.50.

Find the premium of a 1-year call option to receive 1 share of ABC in exchange for 0.4 shares of XYZ.

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