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A call with a strike price of $65 costs $5. A put with the same strike price and expiration date costs $4. Construct a table
A call with a strike price of $65 costs $5. A put with the same strike price and expiration date costs $4. Construct a table that shows the profit from a straddle (Buy both the call and the put). For what range of stock prices would the straddle lead to a loss? The answers correspond to the letters in the table. Stock Price St> 65 ST 565 Payoff (a) (c) Profit (b) (d) None of the others (a) 65 - ST; (b) 65 - ST; (c) ST-65; (d) ST-56 (a) ST-65; (b) ST - 74; (c) 65-ST; (d) 56-ST (a) 65 - St; (b) 56-ST; (c) ST-65; (d) ST-56 (a) ST-65; (b) ST-56; (c) 65 - ST; (d) 56 - ST
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