You have shorted a put option on Ford stock with a strike price of $ 1 5
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Question:
You have shorted a put option on Ford stock with a strike price of $ When you soldwrote the put, you received $ The option will expire in exactly six months' time.
a If the stock is trading at $ in six months, what will your payoff be What will your profit be
b If the stock is trading at $ in six months, what will your payoff be What will your profit be
c Draw a payoff diagram showing the value of the put at expiration as a function of the stock price at expiration.
d Redo c but instead of showing payoffs, show profits.
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Part
a The payoff of the short is $
enter your response here and the profit of the short is $
enter your response here.
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