Question: Consider two risky assets with prices S. (0) = 100, S2(0) 200. Assume that in the future we can have the following prices (90,220) with

Consider two risky assets with prices S. (0) = 100, S2(0)

Consider two risky assets with prices S. (0) = 100, S2(0) 200. Assume that in the future we can have the following prices (90,220) with probability 0.3, (S1(1), S2(1)) = (110, 180) with probability 0.4, (130, 210) with probability 0.3. 1.1. (10 marks) In Excel, verify that { = Mi = 0.1, H2 = 0.005, 01 = 0.155, 02 = 0.0879, P1,2 = -0.220, (values 01,02 and P1,2 of are rounded up to three digit accuracy). Provide all formulae that were used for the verification

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