1. Draw the diagrams for value(payoff) and profit of buying a call and a put, respectively.

2) If the contract size of an option contract was 100 and you purchased 5 contracts,

a. How many options are you purchasing?

b. Write down the number of contracts and the number of options one more time below.

3) For market timing trading (= speculative trading),

Buy a put option when the price of the underlying asset is expected to go ____________.

Buy a call option when the price of the underlying asset is expected to go ____________.