Question: Need help with an old test question. Thanks Question 6: Butterfly Spread 10 points Consider the diagram below which is a long butterfly spread. 1)

Need help with an old test question. Thanks Question 6: Butterfly

Need help with an old test question. Thanks

Question 6: Butterfly Spread 10 points Consider the diagram below which is a long butterfly spread. 1) Draw the payoff structure of a short position in a butterfly spread 2) Why would an investor "go short" a butterfly spread 3) Create an explicit short butterfly spread using caps and floors Profit

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