$5.$ a$.$ Consider a bullish spread option strategy using a call option with a $$25$ exercise price pricea at $$4$ and a call option with a $$40$ exercise price priced at $$2\mathrm{.}50.$ If the price of the stock increases to $$50$ at expiration and each option is exercised on the expiration date, the net profit per share at expiration $($ignoring transaction costs$)$ is:

i$.$ $$8\mathrm{.}50$

$11.$ $$13\mathrm{.}50$

iii. $$16\mathrm{.}50$

iv$.$ $$23\mathrm{.}50$

b$.$ A put on XYZ stock with a strike price of $$40$ is priced at $$2\mathrm{.}00$ per share, while a call with a strike price of $$40$ is priced at $$3\mathrm{.}50.$ What is the maximum per$-$share loss to the writer of the uncovered put and the maximum per$-$share gain to the writer of the uncov$-$

ered call?

$1.$

li$.$

ill. iV$.$

Maximum Loss to Put Writer

Maximum Gain to Call Writer

$$38\mathrm{.}00$

$ $3\mathrm{.}50$

$$38\mathrm{.}00$

$$36\mathrm{.}50$

$$40\mathrm{.}00$

$ $3\mathrm{.}50$

$$40\mathrm{.}00$

$$40\mathrm{.}00$