12.1. A marketmaker sells a straddle on a stock. You are given: (i) The stock's price follows the BlackScholes framework. (ii) 3(0) = 45. (iii) The continuously compounded risk-free rate is 0.1 0. (iv) The stock pays no dividends. (y) The annual volatility of the stock is 0.2. (vi) The straddle consists of European options and expires in one year. The market-maker delta-hedges the sale by buying shares of the underlying stock. Calculatethe amount of money the market-maker spends on the stock. an n 1.. :._.___4_._|_...._ nnn _|_____ _z _J.__|. ___ _r ..._..|_: Ill._ 1. _|_u_ r. __.__ r... _ _n:__ _. l-...._.___._ __n _._A:_.__