This is a problem that has THREE questions. Therefore, please choose THREE answers (one choice for each question) to get full credit for this questions, otherwise you will only get partial points.

A call option with a strike price of $65 costs $8. A put option with a strike price of $58 costs $9.

1) How can a strangle be created?

2) With the strangle created above, what is the profit/loss if the stock price is $41?

3) With the strangle created above, when would the investor gain a positive profit?

		1) Strangle can be created by buying a call and shorting a put.
		1) Strangle can be created by shorting a call and buying a put.
		1) Strangle can be created by shorting both a call and a put.
		1) Strangle can be created by buying both a call and a put.
		2) profit of $2
		2) loss of $17
		2) no profit ($0)
		2) profit of $5
		3) a positive profit is created when stock price is above $82
		3) a positive profit is created when stock price is below $82
		3) a positive profit is created when stock price is below $50
		3) a positive profit is created when stock price is above $50