Instructions: Answer all objective problems on the scantron provided. All objective problems are worth 3 points. Answer all other problems in the space provided Consider a portfolio consisting of a short call with an exercise price of E, a short position on a non-dividend paying stock at an initial price of S and a short or borrowed position of riskless bonds with a face value of E and maturing when the call expires. What should such a portfolio be worth? a. C + P- E(1+r)^-T b. C - S c. P d. P + S - E(1 + r)^-T e. none of the above A three-month call option with a strike price of $50 is currently trading at $5. The stock price is $50. An investor has $5,000 to invest and is able to purchase 10 options or 100 shares (cash account). a. Consider a long equity position (100 shares) or a purchased (10) option position. For both strategies compute the three-month return on investment if at the expiration date the stock price is $40. eat (a) if the option is a put option and priced at $5.00