(a) Find the hedging portfolio for an Arrow–Debreu security V that pays in a geometric Brownian…

(a) Find the hedging portfolio for an Arrow–Debreu
security V that pays  in a geometric Brownian motion model.

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(b) Find the hedging portfolio for an Arrow–Debreu
security V that pays off UT = I(XY (T ) ≥ K) · XT in the same
model.

(c) Combining the results from (a) and (b), find the
hedging portfolio for a contract W that pays off WT = UT −K ·VT . Note
that W is a European call option.