Question: We will derive a two-state put option value in this problem. Data: 5o = $200; X = $210; 1 + r= 1.10. The two possibilities

We will derive a two-state put option value in this problem. Data: 5o = $200; X = $210; 1 + r= 1.10. The

We will derive a two-state put option value in this problem. Data: 5o = $200; X = $210; 1 + r= 1.10. The two possibilities for S, are $230 and $180. Required: a. The range of Sis $50 while that of Pis $30 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.) X Answer is complete but not entirely correct. Hedge ratio 0.40 X b. Form a portfolio of three shares of stock and five puts. What is the (nonrandom) payoff to this portfolio? (Round your answer to 2 decimal places.) X Answer is complete but not entirely correct. Nonrandom payoff $ (120.00) X c. What is the present value of the portfolio? (Round your answer to 2 decimal places.) > Answer is complete but not entirely correct. Present value $ 12.95 x d. Given that the stock currently is selling at $200, calculate the put value. (Do not round intermediate calculations and round your answer to 2 decimal places.) Put value

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