# Tag Info

I read the question as follows: You have one stock $S_0$ and after one period it either goes up to $S^+$ where the option takes the value $f^+$ or it goes down to $S^-$ where the option takes the value $f^-$. The bond grows from $B_0$ to $B_1 = B_0 \exp(r)$. Then you need to solve $$a S^+ + b B_1 = f^+ \\ a S^- + b B_1 = f^-$$ for $a,b$ which are $2$ ...