Question: plz write neatly and circle u answer only answer to red!!! Don't just copy Ch egg answer!!! (1 point)An asset has value 30 = 60

plz write neatly and circle u answer

only answer to red!!!

Don't just copy Ch egg answer!!!

plz write neatly and circle u answer only answer

(1 point)An asset has value 30 = 60 at t = 0, and will have unknown value 3;- at time T. A call option on the asset with strike K = 50 is currently (t = 0) selling for CD = 11. The discount tactorfor the period 0 to T is 1W 2 98/100. a) Consider the portfolio constructed att = U by selling (short) one unit of the asset' buying one call option, and investing the present value of the strike K in a bank at the risk-free rate Then the cashflow at time 0 is The funds in the bank grow over the period 0 to T to the amount At t = T, withdraw the funds from the bank, reacquire and return asset to owner. If 3;: 2 K, reacquire the asset by exercising the call option: the cash ow at time T is If ST

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