The current price of a stock is $658 and the annual standard deviation of the rate of return on the stock is 50%. The stock is expected to pay dividends of $1.25 in 1 months and $1.25 in 4 months. A European call option on the stock has a strike price of $640 and expires in 0.5 years. The risk-free rate is 3% (continuously compounded).

What is the present value of the dividends?

What is N(d₁)?

What is N(d₂)?

What should be the price (premium) of the call option?