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Draw payoff diagram showing the payoff at expiration

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You shorted a call option on Intuit stock with a strike price of ?$36. When you sold? (wrote) the? option, you received ?$5. The option will expire in exactly three? months' time.

a. If the stock is trading at ?$54 in three? months, what will your payoff? be? What will your profit? be?

b. If the stock is trading at ?$28 in three? months, what will your payoff? be? What will your profit? be?

c. Draw a payoff diagram showing the payoff at expiration as a function of the stock price at expiration.

d. Redo? c, but instead of showing? payoffs, show profits.

Reference no: EM132842787

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