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Question: Suppose that a trader sells a September European call option to buy a share for $10 which costs $1.Now we are at expiration, under what circumstances will the seller of the option (i.e., the trader with the short position) make a profit?Under what circumstances will the option be exercised?
Draw a diagram (by hand and insert a photograph) illustrating how the profit from a short position in the option depends on the stock price at maturity of the option.
provide an expanded answer with APA references
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