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Problem 28-02

A put is the option to sell stock at $53. It expires after three months and currently sells for $3 when the price of the stock is $55.

1. If an investor buys this put, what will the profit be after three months if the price of the stock is $58? $53? $48? Round your answers to the nearest dollar. Use a minus sign to enter loss values, if any. If the answer is zero, enter "0".

   Price of the stock	Profit on the position in the put
   $58	$
   $53	$
   $48	$

2. What will be the profit from selling this put after three months if the price of the stock is $58? $53? $48? Round your answers to the nearest dollar. Use a minus sign to enter loss values, if any. If the answer is zero, enter "0".

   Price of the stock	Profit on the position in the put
   $58	$
   $53	$
   $48	$