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The current price of Natasha Corporation stock is $ 5 . 6 1 . In each of the next two years, this stockprice can either

The current price of Natasha Corporation stock is $5.61. In each of the next two years, this stockprice can either go up by $2.5 or go down by $2.0. The stock pays no dividends. The one-yearrisk-free interest rate is 3.6% and will remain constant. Using the Binomial Model, calculate theprice of a two-year call option on Natasha stock with a strike price of $7.0.

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