, SIN2, SIDE, DIVE, PIDy yjuzorviDziV Z OrVID basic events or s,uz ... X Y . . . notes Exercise 17.4. Consider the 2 period tree model below. The probabilities for each outcome are listed in the first column on the right-had side. 1/12 2/12 3/12 1/12 4/12 1/12 (a) List all events that are in the time-1 sigma algebra. (b) Compute the conditional probabilities for each state given the time-1 sigma alge- bra. (c) Values for Z(2) are listed in the second column. Compute the values of Z(1) and Z(0) so that (Z(0), Z(1), Z(2)) is a martingale