Please solve in excel: Chicago investment firm is offering a new financial derivative called a $$windy put$.$ The windy

put is European and has a payoff at expiration equal to Max$(0\mathrm{.}75$S T $,70-$S T $),$ where S T is the price

of the underlying stock on the expiration date.

a$.$ Graph the payoff of the windy put on the expiration date as a function of the underlying stock

on that date.

b$.$ Decompose $($break down$)$ a windy put into a portfolio of underlying stocks and standard

European put options on the underlying stock.

c$.$ Using your answer to b$.$ above, price a windy put by two methods: The Black Scholes Merton

model and a three$-$step binomial tree. Use the following data:

$-$ Underlying stock price is $$50$ today

$-$ Time to expiration is $1$ year

$-$ Risk$-$free rate is $6\%$

$-$ Standard deviation of the underlying stock return is $20\%$