Answer questions (a)-(d) of Exercise 2 for this contingent claim. 4. Consider the multi-period CRR model described in the text and a Eu- ropean contingent claim X. Suppose that trading in the contingent claim is allowed at each of the times t = 0,1,...,1 1, where the price of the contingent claim at time t is given by an Ft-measurable random variable Ct. Let 0* be a replicating strategy (in stock and bond) for the contingent claim X. Show that V+(0*) = (17) T-EP" [X | Ft), t=0,1,..., T. (2.65) Formulate a notion of an arbitrage opportunity in the market consisting of stock, bond and contingent claim. Show that the process Ct = V+(0*),t = 0,1,...,T - 1 defines the unique arbitrage free price process for the contin- gent claim. Answer questions (a)-(d) of Exercise 2 for this contingent claim. 4. Consider the multi-period CRR model described in the text and a Eu- ropean contingent claim X. Suppose that trading in the contingent claim is allowed at each of the times t = 0,1,...,1 1, where the price of the contingent claim at time t is given by an Ft-measurable random variable Ct. Let 0* be a replicating strategy (in stock and bond) for the contingent claim X. Show that V+(0*) = (17) T-EP" [X | Ft), t=0,1,..., T. (2.65) Formulate a notion of an arbitrage opportunity in the market consisting of stock, bond and contingent claim. Show that the process Ct = V+(0*),t = 0,1,...,T - 1 defines the unique arbitrage free price process for the contin- gent claim