1. An investor buys a bearish spread constructed with a 35 put traded at 3 and a 30 put traded at 1. What is the payoff from this bear spread strategy? Assume the interest rate is zero. (a) Determine the positions in the two puts and fill in the following payoff table. Transactions S=35 (b) What are the max loss, max gain and the break-even level for this bear spread? (c) If a bull spread of 35 call and 30 call is traded at 2, is there an arbitrage opportunity between the calls and puts? Show your strategy in a table. 1. An investor buys a bearish spread constructed with a 35 put traded at 3 and a 30 put traded at 1. What is the payoff from this bear spread strategy? Assume the interest rate is zero. (a) Determine the positions in the two puts and fill in the following payoff table. Transactions S=35 (b) What are the max loss, max gain and the break-even level for this bear spread? (c) If a bull spread of 35 call and 30 call is traded at 2, is there an arbitrage opportunity between the calls and puts? Show your strategy in a table