1. Consider a one-period market model on some probability space (Q,F,P) with two assets S0 and S1. Suppose that those assets satisfy T = (1,4), P(S =1.25) 1, P(S = 2) = 3, and P(S = 8) = 3. a) Let C be a call on S1 with strike K 5, i.e., C = (S1 - 5)+. Determine an arbitrage-free price T for C. Are there any arbitrage-free prices for C that are not equal to T? b) Consider an extended market model consisting of the original two assets S0 and S1, the call C from part (a), and a fourth asset S3 that satisfies S3 = (S1 - 5)+. Assume that the price vector f := (7, r1,72,73) T(see part (i)) satisfies T3