You are attempting to value a call option with an exercise price of $100 and one year to expiration. The underlying stock pays no dividends, its current price is $90, and you believe it has a 50% chance of increasing to $120 and a 50% chance of decreasing to $80. The risk-free rate of interest is 10%.

(a) Compute the hedge ratio.

(b) Construct a riskless portfolio.

(c) Compute the payoff for the riskless portfolio.

(d) Compute the present value of the total payoff.

(e) What is the value of the option in the riskless portfolio?