Question: Consider the following probability space (2,F,P): = {w, wz, w3}, F = 2 and P[{w}]>0 for i = 1,2,3. Suppose r> -1 and -1

Consider the following probability space (2,F,P): = {w, wz, w3}, F =

Consider the following probability space (2,F,P): = {w, wz, w3}, F = 2 and P[{w}]>0 for i = 1,2,3. Suppose r> -1 and -1 < d 0 is an arbitrary (but fixed) strike price? If it does, prove (or disprove) its uniqueness and calculate the initial cost - So. 8 pts (c) How do your answers to (a) and (b) change in the following three scenarios: one of P[{w}] is equal to zero, i = 1,2,3? 10 pts

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