QUESTION 4 Let's assume you hold a two-year American call option with an exercise price of $125 on a stock that is presently trading at $172. You anticipate a factor of 1.35 growth and a factor of 0.75 decline in the stock. Determine the option value and explain the moneyness of the option if the interest rate is 4%. Also, explain why the Binomial Option pricing model (BOP) is used to price options, it's advantages and share 8 assumptions of the BOP? Show all your calculations.