Consider the binomial model with T = 2, So = 30, Bo = 30, u u= TO r = 0, and d = (a) Determine the risk neutral probability: (2 points) 1/2 Your last answer was interpreted as follows: (b) Suppose that we have European contingent claim with payoff 02 = max{S2, S1 + 1}. (i) Select all correct answers. (In total 2 points) The model in this question is arbitrage free since the binomial model is always arbitrage free. The arbitrage free price of a contingent claim can be negative. The model in this question is arbitrage free since since u >1+r > d. 02 is not replicable since only put and call options are replicable in the binomial model. I don't want to answer this question (ii) Determine the arbitrage free price of O2 at t = 0: (2 points) You can enter your result as fraction or as float. If you enter you enter your answer as float then you have to enter at least 3 relevant decimal places. (iii) Let o be a replicating strategy for 2. (2 points each) If Sj =33 then Vi(0) = If Si = 27 then Vi(0) = Consider the binomial model with T = 2, So = 30, Bo = 30, u u= TO r = 0, and d = (a) Determine the risk neutral probability: (2 points) 1/2 Your last answer was interpreted as follows: (b) Suppose that we have European contingent claim with payoff 02 = max{S2, S1 + 1}. (i) Select all correct answers. (In total 2 points) The model in this question is arbitrage free since the binomial model is always arbitrage free. The arbitrage free price of a contingent claim can be negative. The model in this question is arbitrage free since since u >1+r > d. 02 is not replicable since only put and call options are replicable in the binomial model. I don't want to answer this question (ii) Determine the arbitrage free price of O2 at t = 0: (2 points) You can enter your result as fraction or as float. If you enter you enter your answer as float then you have to enter at least 3 relevant decimal places. (iii) Let o be a replicating strategy for 2. (2 points each) If Sj =33 then Vi(0) = If Si = 27 then Vi(0) =