A stock currently costs S_0 per share. In each time period, the value of the stock will either increase or decrease by u and d respectively, and the risk-free interest rate is r. Let S_n be the price of the stock at t = n, for 0 lessthanorequalto n lessthanorequalto N, and consider three derivatives which expire at t = N, a call option V^call_N = (S_n - K)^+, a put option V^put_N = (K - S_n)^+, and a forward contract F_N = S_N - K. The forward price is the strike price such that the price of the forward contract is F_0 = 0. Show that if N = 1 (one-period binomial model), and K = (1 + r) S_0, then F_0 = 0. Show that if N = 1 (one-period binomial model), and K = (1 + r) S_0, then V^call_0 = V^put_0. Explain why in the general N-period model, for any strike price K, V^call_N = F_N + V^put_0. That is, if you buy at t = 0 a forward contract and a put option, and hold them until expiration, the payoff you receive is the same as the payoff of a call option. What can you say about the prices of these three options at t = 0