1. Let A(O)-100, A(1)-110, S(0)-100 and let S(1)-120 with probability 6 and s(1)-90 with probability 4. For a portfolio with X-20 shares and Y-10 bonds, calculate V(O), V(1) if stocks go up, V(1) if stocks go down, E(K), and 8v 2. Let A(0)-100, A(1)-110, s(0)-100, S(1)-90 with probability p, S(1)-120 with probability 1-p (where 0xpc1). Compute the price of the call option C(0) at exercise time 1 with strike price 110