I dont understand how we arrived at selling 3 calls, borrowing 102.5 and and buying one share. It makes sense why we have to find the value of the replicating portfolio because that enables us to show that there exists an arbitrage opportunity. I also know that we have to sell the more expensive and buy the cheaper. How did we determine how many call options to sell?

See here for the numerical solution to the exact bank account values:

http://acscihotseat.org//index.php?qa=1120&qa_1=describing-trading-strategy-with-arbitrage-opportunity-tut