A British speculator purchased a put option which has a premium on the US dollar at 0.02 per unit and the strike price is 0.60. One option contract represents 50,000 $. the speculator decided to exercise the option at the expiration date when the spot rate of the dollar was 0.55. the speculator purchased the pounds in the spot market at the same time.

Given this information, calculate the net payoff (loss or profit) to the purchaser of this put option. Assuming that the seller (underwriter) of the put option sold the pounds received immediately after the option was exercised, calculate the the net payoff (loss or profit) to the seller of this put option. Draw two contingency graphs: one for purchaser of this put option and another for seller.