1. You are given the following information about a securities market: There are three nondividend-paying stocks, X,Y, and Z. The current stock prices are (Xo, Yo, Zo) = (100, 100, 100). The yearly compounded risk-free interest rate is 1%. There are four possible outcomes for the prices of X, Y, and Z one year from now: (X1(w), Y1(w), Z1(w)) = (120, 110, 110) (110, 120, 100) (90, 80, 100) (80, 90,95) w= :w=W2 :W=W3 :W=W4. The market is complete, which means a unique risk-neutral mea- sure exists. Let V.CX be the current price of a call option on X, and V.P.Z the current price of a put on Z. Both options expire in one year, and have a common strike price of K = 100. Let V.XYZ be the initial price of a type of " forward exchange, which at time T = 1 pays X1 +Y1 21. Compute the risk-neutral measure (25 pts), and . V.C,X (25 pts), and (25 pts), and V.XYZ (25 pts). Vez 1. You are given the following information about a securities market: There are three nondividend-paying stocks, X,Y, and Z. The current stock prices are (Xo, Yo, Zo) = (100, 100, 100). The yearly compounded risk-free interest rate is 1%. There are four possible outcomes for the prices of X, Y, and Z one year from now: (X1(w), Y1(w), Z1(w)) = (120, 110, 110) (110, 120, 100) (90, 80, 100) (80, 90,95) w= :w=W2 :W=W3 :W=W4. The market is complete, which means a unique risk-neutral mea- sure exists. Let V.CX be the current price of a call option on X, and V.P.Z the current price of a put on Z. Both options expire in one year, and have a common strike price of K = 100. Let V.XYZ be the initial price of a type of " forward exchange, which at time T = 1 pays X1 +Y1 21. Compute the risk-neutral measure (25 pts), and . V.C,X (25 pts), and (25 pts), and V.XYZ (25 pts). Vez