3 Consider the two-periods binomial model (N-2) with So-100. u-12. d-0.8 and take the interest rate r 0.1. Consider the standard Asian call option with maturity M-2 and strike K = 100, The payoff of the option at maturity equals N = max i) Compute the arbitrage-free price Vo ii) Compute the number of stocks n the hedging/replicating portfolio. Recall the risk neutral pricing and delta hedging formulas 1+r -a , , S(H) S1(T) -n T" 8 points 3 Consider the two-periods binomial model (N-2) with So-100. u-12. d-0.8 and take the interest rate r 0.1. Consider the standard Asian call option with maturity M-2 and strike K = 100, The payoff of the option at maturity equals N = max i) Compute the arbitrage-free price Vo ii) Compute the number of stocks n the hedging/replicating portfolio. Recall the risk neutral pricing and delta hedging formulas 1+r -a , , S(H) S1(T) -n T" 8 points