1. You are considering an investment in the following structured product. At maturity T, the structured product will pay $100 for every dollar the S&P 500 exceeds its current level of $3000. If the S&P 500 ends up below $3000, the payout is zero. Also, your payout maxes out at $10,000: that is, even if the S&P 500 rises above $3100, you will still only make $10,000 at most. How much is this structured product worth today? Proceed as follows: Draw the payoff diagram for the structured product at maturity. Find a portfolio of derivatives that replicates that payout. Use the table below to calculate the price of this replicating portfolio. The table reports the market prices of puts and calls written on the S$P 500 with maturity T of different strikes. K 2800 2900 3000 3100 3200 Call Price Put Price 485.03 229.59 432.60 275.17 384.65 325.24 341.03 379.64 301.53 438.16