Question $3(1$ point$)$ ltst

There is only one period. Call options exist that permit the holder to buy $1$ share of Western at a strike price, X$,$ of $$35.$ Western's options will expire at the end of $6$ months $($t is the number of years until expiration, so t $=0\mathrm{.}5$ for Western's options$).$ Western's stock price, P$,$ is currently $$41$ per share. We assume that, at the end of the period, the stock's price can take on only one of two possible values, so this is called the binomial approach. For this example, Western's stock will either go up $($u$)$ by a factor of $1\mathrm{.}21$ or go down $($d$)$ by a factor of $0\mathrm{.}60.$ The risk$-$less rate is $0\mathrm{.}06.$ If you buy $1$ call option, what is the present value of the riskless, i$.$e$.,$ hedged, portfolio?

NOTE: Enter your answer with two decimal places and no dollar sign. If your answer is $$3,459,$ enter $3\mathrm{.}46$

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