2 Black-Scholes Use the Black-Scholes formula to solve these three problems 1. Price a one year European call option with strike price 32, written on a $30 stock. Volatility is 12%. The stock will pay a dividend in 2 months time, and then again in 8 months time, each of $3. Interest rates are 4%. 2. Now suppose that the option in the previous question was American. Use Black's approximation to price the option. 3. Price a 3 month European put option with strike price 1500, written on the Dow Jones Industrial Average Index. Suppose that the index is currently at 1450, Volatility is 10%, and interest rates are 2.5%. The firms in the index pay dividends at a continuous rate of 1.2%