Reconsider the determination of the hedge ratio in the two-state model where we showed that one-third share of stock would hedge one option. The possible end-of-year stock prices, use - $100 (up state) and d5e - $70 (down state) a. What would be the call option hedge ratio for each of the following exercise prices $100 $90, $77. $ 70, given the possible end-of- year stock prices, wsy - $100 (up state) and dse - $(down state)? (Round your answers to 3 decimal places.) Hedge Ratio Exercise Price $ 100 90 $ 77 $ 70 b. What do you conclude about the hedge ratio as the option becomes progressively mod in the money Increases to a maximum of 10 Decreases to a minimum of