# Question: A put option in finance allows you to sell a

A put option in finance allows you to sell a share of stock at a given price in the future. There are different types of put options. A European put option allows you to sell a share of stock at a given price, called the exercise price, at a particular point in time after the purchase of the option. For example, suppose you purchase a six-month European put option for a share of stock with an exercise price of \$26. If six months later, the stock price per share is \$26 or more, the option has no value. If in six months the stock price is lower than \$26 per share, then you can purchase the stock and immediately sell it at the higher exercise price of \$26. If the price per share in six months is \$22.50, you can purchase a share of the stock for \$22.50 and then use the put option to immediately sell the share for \$26. Your profit would be the difference, \$26 - \$22.50 = \$3.50 per share, less the cost of the option. If you paid \$1.00 per put option, then your profit would be \$3.50 2 \$1.00 = \$2.50 per share.
a. Build a model to calculate the profit of this European put option.
b. Construct a data table that shows the profit per share for a share price in six months between \$10 and \$30 per share in increments of \$1.00.

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