You use the following information to construct a binomial forward tree for modeling the price movements of a nondividend-paying stock:

(i) The length of each period is 4 months.

(ii) The current stock price is 50.

(iii) The stock’s volatility is 30%.

(iv) The continuously compounded risk-free interest rate is 8%.

(v) The continuously compounded expected return on the stock is 15%.

Calculate the continuously compounded true discount rate for an 8-month 40-strike European call option during the first time period.