Consider two secunitios that pay risk-free cash flows over the next two yoars and that have the current market prices shown here (Click on the following icon in order to copy its contents into a...

Extracted text: Consider two secunitios that pay risk-free cash flows over the next two yoars and that have the current market prices shown here (Click on the following icon in order to copy its contents into a spreadshoet) Price Today $384 Cash Flow in Two Years Security Cash Flow in One Year B1 $400 B2 $344 $400 a. What is the no-arbitrage price of a secunty that pays cash flows of $400 in one year and $400 in two years? b. What is the no arbitrage price of a security that pays cash flows of $400 in one year and $2,800 in two yoars? c. Suppose a security with cash flows of $200 in one year and $400 in two years is trading for a price of $520 What arbitrage opportunity is available? a. What is the no-arbitrage price of a secunity that pays cash flows of S400 in ono yoar and $400 in two yoars? The no arbitrage price is s (Round to the nearest dollar) b. What is the no-arbitrage price of a security that pays cash flows of $400 in one yoar and $2,800 in two years? The no-arbitrage price is S (Round to the nearest dollar ) c. Suppose a secunity with cash flows of $200 in one year and $400 in two years is trading for a price of $520 What arbitrage opportunity s available? (Select the best choice below) O A. Buy two shares of the security and sell one share oach of B1 and B2 O B. Buy two shares of the secunty and sell one share of B1 and two shares of B2 OC. Sell two shares of the security and buy one share of B1 and two shares of B2 D. Sell two shares of the security and buy one share each of B1 and B2. O O O