Pfiza Corporation has 1 million shares outstanding, currently trading at $90 each share. The risk-free interest rate is 1.5% per year. The standard deviation (0) of Pfiza's stock returns is 40% a year. w Ms. Cindy has just become the CEO of the Pfiza at the beginning of this year and been offered an incentive scheme based on the performance of the company's stocks. At the end of this year, Ms. Cindy will be paid a cash bonus of $25,000 for every dollar that the company's stock price rises above $110 per share. Consider Ms. Cindy's incentive scheme as a financial option. QUESTIONS a) Is Ms. Cindy's incentive scheme a call or a put option? Is it an American or European type option? [2 marks] b) Use the Black-Scholes option pricing model to estimate the value of each option. What is the total value of Ms. Cindy's incentive scheme? [8 marks]