Take a (non-dividend paying) stock with a current price of $100, volatility of 15% per annum, and an expected return of 10% per annum. The interest rate is 5% per annum (with continuous compounding). (a) Using the discrete approximation to the Geometric Brownian Motion (with pl, o given above), what is the (approximate) probability that 1 day from now, the stock price will have increased by at least one dollar? (b) Use Black-Scholes formula to find the current price of a European call option on the above stock, with maturity one year from now and strike K = 110. Take a (non-dividend paying) stock with a current price of $100, volatility of 15% per annum, and an expected return of 10% per annum. The interest rate is 5% per annum (with continuous compounding). (a) Using the discrete approximation to the Geometric Brownian Motion (with pl, o given above), what is the (approximate) probability that 1 day from now, the stock price will have increased by at least one dollar? (b) Use Black-Scholes formula to find the current price of a European call option on the above stock, with maturity one year from now and strike K = 110