Problem 0.2. We let Cs(t, K, T) denote the price at time t of a call option on stock S with strike K expiring at time T. Show that the portfolio of options given by 1 AX {{Cs(t, X - AX,T) - Cs(t, X,T)] [Cs(t, x, T) - Cs(t, X+AX,T)]} will pay 1.00 if St = X and zero otherwise. In expressions like these, a coefficient such as 1/AX should be interpreted as the number of calls to purchase (or short, if accompanied by a minus). Problem 0.2. We let Cs(t, K, T) denote the price at time t of a call option on stock S with strike K expiring at time T. Show that the portfolio of options given by 1 AX {{Cs(t, X - AX,T) - Cs(t, X,T)] [Cs(t, x, T) - Cs(t, X+AX,T)]} will pay 1.00 if St = X and zero otherwise. In expressions like these, a coefficient such as 1/AX should be interpreted as the number of calls to purchase (or short, if accompanied by a minus)