Forward. Let A(0) = 60, A(T) = 65, S(0) = 55 dollars. (a) Calculate the forward price F of the stock. (b) Find an arbitrage opportunity (portfolio) if the forward price of stock is F = 60 dollars. Arbitrage. Let A(0) = 80, A(T) = 90, S(0) = 50 dollars. Furthermore let S(T) $55 $40 with probability 20% with probability 80% Does an arbitrage opportunity arise? If yes, build an arbitrage portfolio and show that this portfolio is indeed an arbitrage opportunity. Forward. Let A(0) = 60, A(T) = 65, S(0) = 55 dollars. (a) Calculate the forward price F of the stock. (b) Find an arbitrage opportunity (portfolio) if the forward price of stock is F = 60 dollars. Arbitrage. Let A(0) = 80, A(T) = 90, S(0) = 50 dollars. Furthermore let S(T) $55 $40 with probability 20% with probability 80% Does an arbitrage opportunity arise? If yes, build an arbitrage portfolio and show that this portfolio is indeed an arbitrage opportunity