Question: Explain and carefully describe the following four security positions, drawing payoff diagrams wherever necessary to support your answer: a. Short a forward contract with a

Explain and carefully describe the following four security positions, drawing payoff diagrams wherever necessary to support your answer:
a. Short a forward contract with a delivery price of $100
b. Short-selling a stock at $100
c. Going short on an option with a of $100

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A A short forward contract is an agreement to sell the underlying commodity at the forward price F 1... View full answer

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