Question: We will derive a two-state put option value in this problem. Data: 50 - 180; X = 190;1+ r1.1. The two possibilities for Sare 210

We will derive a two-state put option value in this problem. Data: 50 - 180; X = 190;1+ r1.1. The two possibilities for Sare 210 and 110. a. The range of Sis 100 while that of Pis 80 across the two states. What is the hedge ratio of the put? (Negative value should be indicated by a minus sign. Round your answer to 2 decimal places.) Hedge ratio b. Form a portfolio of 4 shares of stock and 5 puts. What is the (nonrandom) payoff to this portfolio? (Round your answer to 2 decimal places.) Norrandom payoff c. What is the present value of the portfolio? (Round your answer to 2 decimal places.) Present value

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