3. A stock is currently trading at a price of $114. You construct a butterfly spread using calls of three different strike prices on this stock, with the calls expiring at the same time. You go long one call with an exercise price of $110 and selling at $8, go short two calls with an exercise price of $115 and selling at $5, and go long one call with an exercise price of

$120 and selling at $3.

A. Determine the value at expiration and the profit for your strategy under the following outcomes:

i. The price of the stock at the expiration of the calls is $106.

ii. The price of the stock at the expiration of the calls is $110.

iii. The price of the stock at the expiration of the calls is $115.

iv. The price of the stock at the expiration of the calls is $120.

v. The price of the stock at the expiration of the calls is $123.

B. Determine the following:

i. the maximum profit.

ii. the maximum loss.

iii. the stock price at which you would realize the maximum profit.

iv. the stock price at which you would incur the maximum loss.

C. Determine the breakeven underlying price at expiration of the call options.