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7. Elliot Rosewater constructs a portfolio comprised of the following: - Long 3 shares of RWF stock, with a current price of 72.00 - Short

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7. Elliot Rosewater constructs a portfolio comprised of the following: - Long 3 shares of RWF stock, with a current price of 72.00 - Short 2 call options on RWF, with a strike price of 72.00 and three months to expiration. The price of each call option is 6.00 - Long 2 put options on RWF, with a strike price of 72.00 and three months to expiration. The price of each put option is 5.013 - Short a zero-coupon bond, which matures in three months with a face amount of 144. The current risk-free rate is 5.52%. a. Determine the cost (as of today) of Elliot's portfolio. (5 points) b. Determine the price of RWT stock at the end of three months if the portfolio breaks even at that time. ( 5 points) c. Determine the minimum profit of the portfolio at the end of three months. (5 points) d. Determine the stock price at the end of three moths such that the profit of the portfolio is 27.00. ( 5 points). 7. Elliot Rosewater constructs a portfolio comprised of the following: - Long 3 shares of RWF stock, with a current price of 72.00 - Short 2 call options on RWF, with a strike price of 72.00 and three months to expiration. The price of each call option is 6.00 - Long 2 put options on RWF, with a strike price of 72.00 and three months to expiration. The price of each put option is 5.013 - Short a zero-coupon bond, which matures in three months with a face amount of 144. The current risk-free rate is 5.52%. a. Determine the cost (as of today) of Elliot's portfolio. (5 points) b. Determine the price of RWT stock at the end of three months if the portfolio breaks even at that time. ( 5 points) c. Determine the minimum profit of the portfolio at the end of three months. (5 points) d. Determine the stock price at the end of three moths such that the profit of the portfolio is 27.00. ( 5 points)

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