1. Consider a European put option on Modana with a strike price of $40 and four months until expiration. Modanas stock price follows this process with equal probabilities: 60 30 15 A three-year coupon bond that pays coupon annually is selling at par with 8 percent annual coupon rate. Assume that Medana's stock pays no dividend. a. What is the price of the put option? b. Create a portfolio that duplicates the payoffs of the put option. c. How much does the duplicating portfolio cost