thank you!

4) The current price of a stock is $100, and we assume that the price can be modeled by geometric Brownian motion X (t) with a drift parameter of 3% per year with a variance parameter of 2% per year. Assume that the annual interest rate is 4% and suppose that we want to sell an option to buy the stock for $120 in 1.5 years. a) What should be the initial price of the option if we do not want an arbitrage Opportunity? b) What should be the price of the option after one year if the stock price has risen to $140, and again assuming we do not want an arbitrage opportunity