Question: 14. please answer clearly You have shorted a put option on Ford stock with a strike price of $12. When you sold (wrote) the put,
You have shorted a put option on Ford stock with a strike price of $12. When you sold (wrote) the put, you received $6. The option will expire in exactly six months' time, a. If the stock is trading at $5 in six months, what will your payoff be? What will your profit be? b. If the stock is trading at $22 in six months, what will your payoff be? What will your profit be? c. Draw a payoff diagram showing the value of the put at expiration as a function of the stock price at expiration d. Redo e, but instead of showing payoffs, show profits. $ a. The payoff of the short is $, and the profit of the short is $0. (Round to the nearest dollar.)
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