(1) Consider a one-period model in which the price of the asset either goes up by 20% or down by 10%. 1 invested in the risk-free bond yields 1.10 at the end of the period. If the initial price of the asset is 100, find a replicating portfolio of cash and assets for a call option that expires at the end of one period and has a strike price of 105. Hence, find the arbitrage-free price of this call option. Find a replicating portfolio for a put option that expires at the end of one period and has a strike price of 105. Hence, find the arbitrage-free price of this put option. Verify the put-call parity relationship in this case. (1) Consider a one-period model in which the price of the asset either goes up by 20% or down by 10%. 1 invested in the risk-free bond yields 1.10 at the end of the period. If the initial price of the asset is 100, find a replicating portfolio of cash and assets for a call option that expires at the end of one period and has a strike price of 105. Hence, find the arbitrage-free price of this call option. Find a replicating portfolio for a put option that expires at the end of one period and has a strike price of 105. Hence, find the arbitrage-free price of this put option. Verify the put-call parity relationship in this case