a) What are the implied risk-neutral probabilities and the implied one-year risk-free rate in the economy? If unable to solve the relevant equations, check that the implied risk-neutral probability of seeing an increase in the stock price is 30% and the risk-free rate is 2% per annum

b) Determine the replicating portfolio of the call option.  


c) What is the arbitrage free price of a European put option with an exercise price of $95?