When using binomial approach and Black-Scholes formula for pricing options, do you expect the results to be the same? (3)Why or why not? (2) Price a put and a call with data offered below using both methods and show the prices. Do your results support initial expectations? (5)

Present stock price $30, exercise price $40, interest rate 5%, option expires one year from now, volatility 27%, stock will either move up by 40% or down by 27%.