The current price of a stock is $20. In 1 year, the price will be either $28 or $15. The annual risk-free rate is 7%. The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the question below.

Find the price of a call option on the stock that has a strike price is of $25 and that expires in 1 year. (Hint:Use daily compounding.) Assume 365-day year. Do not round intermediate calculations. Round your answer to the nearest cent.

File Home Insert Draw Page Layout Formulas Data 5 v Calibri V 11 B A S13 fx A B C D E F G H Binomial Model Current price $20.00 High price, Year 1 $28.00 5 Low price, Year 1 $15.00 Risk-free rate, IRF 7.00% Strike price $25.00 8 Time until expiration (in years) 1.00 9 Number of days per year 365 Outcome Stock Price Strike Price Option Payoff Price up $28.00 $25.00 $3.00 Price down $15.00 $25.00 $0.00 15 Range $13.00 $3.00 16 Formulas Number of shares of stock to purchase to 8 create hedge portfolio, Ns: #N/A 19 20 Hedge portfolio's payoff if stock price up #N/A Hedge portfolio's payoff if stock price down #N/A Present value of hedge portfolio #N/A 25 26 Value of call option, Vc #N/A 27 29 E & Sheet1 +