Question: Consider a call option and a put option on a given stock both with a strike of $25. They cost $1.25 and $0.3 respectively. Explain

Consider a call option and a put option on a given stock both with a strike of $25. They cost $1.25 and $0.3 respectively. Explain how a straddle can be created from these two options. Draw the net payoff diagram for the strategy. State the trading ranges at maturity in which the strategy generates a profit.

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