Three put options on a stock have the same expiration date and strike prices of $192.5, $210, and $227.5, and the market prices of the put options are $10.5, $17.5, and $28, respectively.

(a) Explain how a long butterfly spread can be created.

(b) Construct a profit (loss) table for the long butterfly spread strategy at expiration of the options.

(c) Draw the profit (loss) graph for the long butterfly spread strategy at expiration of the options.

(d) For what range of stock prices would the butterfly spread lead to a loss? What is the maximum loss?

(e) For what range of stock prices would the butterfly spread lead to a profit? What is the maximum profit?