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A put option has strike price of 17 and a premium of 5. a) Draw the intrinsic value and profit diagram for the long put.

A put option has strike price of 17 and a premium of 5.

a) Draw the intrinsic value and profit diagram for the long put.

b) At what stock price is the profit equal to zero?

c) If the stock price at the option's expiration is 12, what is the rate of return?

d) What are the maximum profit and loss in dollars?

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