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The following market model S t = S 0 e 0.1(Btt) consist of the savings account t = e 0.1t and the stock S t

The following market model

S_t = S₀e^0.1(Btt)

consist of the savings account _t = e^0.1t and the stock S_t, 0 t 1.

Decide whether the market model is free from arbitrage by using the First Fundamental Theorem of Asset Pricing.

If the model does not admit arbitrage explain how to obtain EMM. If the model admits arbitrage, suggest an arbitrage strategy.

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