4. We will derive a two-state put option value in this problem. We have the following information: So = 100; X = 110; 1 +rf = 1.10. The two possibilities for Sy are 120 and 80. a. Show that the range of S is 40 while that of put option is 30 across the two states. What is the hedge ratio of the put? b. Form a portfolio of three shares of stock and four puts. What is the (nonrandom) pay-off to this portfolio? What is the present value of the portfolio? c. Given that the stock currently is selling at 100, what is the price of this put option