1.Buying a put option which is a 3 month American put option on62,500 with a strike price of $1.5/pound and an option premium of 0.9 cents/ pound.

2.Buying a call option which is a 3 month American put option on62,500 with a strike price of $1.8/pound and an option premium of 0.6 cents/ pound.

a)Drawa diagram showing the profit from the strategy.

b)Identify the value of St in order to be at in-the money(ITM), out-of-the money(OTM) and at-the-money(ATM) (or known as break-even point)