You establish a straddle on Walmart using September call and put options with a strike price of $96. The call premium is $7.80 and the put premium is $8.55.

a. What is the most you can lose on this position? (Input the amount as positive value. Round your answer to 2 decimal places.)

b. What will be your profit or loss if Walmart is selling for $96 in September? (Input the amount as positive value. Round your answer to 2 decimal places.)

c. You buy a share of stock, write a one-year call option with X = $19, and buy a one-year put option with X = $19. Your net outlay to establish the entire portfolio is $18.50. What must be the risk-free interest rate? The stock pays no dividends. (Do not round intermediate calculations. Round your answer to 2 decimal places.)

2.Suppose that todays date is April 15. A bond with a 9% coupon paid semiannually every January 15 and July 15 is quoted as selling at an ask price of 1,015.000. If you buy the bond from a dealer today, what price will you pay for it? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

3.

Masters Corp. issues two bonds with 18-year maturities. Both bonds are callable at $1,075. The first bond is issued at a deep discount with a coupon rate of 6% to yield 11.3%. The second bond is issued at par value with a coupon rate of 12.50% a. What is the yield to maturity of the par bond? (Round your answer to 2 decimal places.)