The following information is provided in the context of a two period (two six-month periods) binomial option pricing model. A stock currently trades at $50 per share and American call options on the stock have an exercise price of $55. You believe the stock will rise by 20% or fall by 40% during each six-month period. The one-year risk free rate is 10%.

Find the probability that the stock increases each period. Round intermediate steps to four decimals.

		.2479
		.7521
		.5854
		.4146

ind the value of the American call based on the binomial option pricing model. Round intermediate steps to four decimals and your final answer to two decimals.

		2.64
		8.70
		5.27
		.95