1. Consider a portfolio that invests 2 and y shares in the risky and risk-free assets, respectively, such that your portfolio value at time t is given by V(t) = r(t) + yB(t) (2) where B(t) denotes the price of the risk-free asset. The portfolio value in the following period is unknown due to the uncertainty associated with S(t+1). Suppose that S(t) = B(t) = $100, what is the conditional expectation and conditional variance of the portfolio value over the next period? In other words, derive a closed-from expression for E[V(t+1)|V(t)) and V[V(t+1)| V(t)] (3) using 2, y, t, u, d, and RF (where Rf denotes the risk-free rate). 1. Consider a portfolio that invests 2 and y shares in the risky and risk-free assets, respectively, such that your portfolio value at time t is given by V(t) = r(t) + yB(t) (2) where B(t) denotes the price of the risk-free asset. The portfolio value in the following period is unknown due to the uncertainty associated with S(t+1). Suppose that S(t) = B(t) = $100, what is the conditional expectation and conditional variance of the portfolio value over the next period? In other words, derive a closed-from expression for E[V(t+1)|V(t)) and V[V(t+1)| V(t)] (3) using 2, y, t, u, d, and RF (where Rf denotes the risk-free rate)