In this project you will investigate hedging in discrete time within the Black-Scholes model. You are to assume that an asset S = (St)f follows the Black-Scholes model with $0 = 100, 0' = 20%, ,a = 10% and the risk-free rate is constant at 2%. You have just sold an at-the-money i year put written on this asset and you wish to hedge it. Assume that, if needed, you may also trade in a call option (on the same asset]I struck at K = 100 (maturity % year), the stock, and the bank account. As well, you will account for transaction costs by assuming you are charged 0.00531 on every one unit of equity traded, and Ul$ on every unit of options traded. [NOTE the catt that yea trade when. Gamma hedging has a FIXED maturity date, but that implies its time to maturity keeps reducing as time flows formant just like the pet that you sold] 1. Compare the move-based with the time-based hedging strategy with delta hedging. Assume a base band of 0.05. 2. Compare the move-based with the time-based hedging strategy with delta and gamma hedging. 3. 1li'Vhat happens if the real-world 1P volatility is a" = 15% but the risk-neutral Q volatility is a" = 20%? 4. Investigate the role that the rebalancing-band in 1. plays on the hedge. Comment on any observations