number 3 only

only complete question 3

of u = 3, and a down factor of d = 2, determine what the value and initial hedge of a European call option with strike K = 9 should have. 3. For a model that has interest rate r = , up factor u = 1.2, and down factor 9, does this model admit arbitrage (explain why or why not, and if it does provide an example to exemplify how). 4. Using the values from problem 2, determine the value and initial hedge