A particular put is the option to sell stock at $40. It expires after three months and currently sells for $2 when the price of the stock is $42.

a) If an investor buys this put, what will the profit be after three months if the price of the stock is $45? $40? $35?

b) What will the profit from selling this put be after three months if the price of the stock is $45? $40? $35?

c) Compare the answers to (a) and (b). What is the implication of the comparison? (Mayo, 20160101, p. 664)