Given the one-period binomial model depicted below, you are asked to derive the equilibrium value a European call option with strike price $60. You may use either the riskless hedge portfolio approach or the replicating portfolio approach. Do not use the binomial formula for this problem. Assume the risk-free rate is 5% and the option expires in 3 months. _72(Su ) 60(S.) 48(Sd) Circle the method you are going to use: riskless hedge portfolio OR replicating portfolio a. What is the hedge ratio? b. What are the payoffs of the portfolio at maturity? If you are using the replicating portfolio, how much would you need to borrow or lend to replicate the payoffs? c. What is the value of the portfolio and the resulting call option value today? d. What are the risk-neutral probabilities of the up and down states