1. I have a long position in a put option on with an exercise price of $2.2/ (premium=$0.10) and a long position in a call option on with an exercise price of $2.32/ (premium=$0.07). Draw the combined graph.

a. What is the name of this strategy?

b. How many breakeven points do we have with the combined graph? What are they?

2. I have a short position in a put option on with an exercise price of $2.2/ (premium=$0.12) and a short position in a call option on with an exercise price of $2.32/ (premium=$0.09). Draw the combined graph.

a. What is the name of this strategy?

b. How many breakeven points do we have with the combined graph? What are they?

3. I shorted a call on euro (X=$1.5, Premium=$0.03) and also shorted a put on euro (X=$1.4, Premium=$0.04).

a. Draw the profit graph for the combined position. Show all the break even points.

b. If exchange rate at expiration is $1.32/euro, what will be my net profit/loss?

c. If exchange rate at expiration is $1.53/euro, what will be my net profit/loss?