A put option in finance allows you to sell a share of stock at a given price in the future. There are different types of put options. A European put option allows you to sell a share of stock at a given price, called the exercise price, at a particular point in time after the purchase of the option. For example, suppose you purchase a six$-$month European put option for a share of stock with an exercise price of $$26.$ If six months later, the stock price per share is $$26$ or more, the option has no value. If in six months the stock price is lower than $$26$ per share, then you can purchase the stock and immediately sell it at the higher exercise price of $$26.$ If the price per share in six months is $$22\mathrm{.}50,$ you can purchase a share of the stock for $$22\mathrm{.}50$ and then use the put option to immediately sell the share for $$26.$ Your profit would be the difference, $$26-$ $$22\mathrm{.}50=$ $$3\mathrm{.}50$ per share, less the cost of the option. If you paid $$1\mathrm{.}00$ per put option, then your profit would be $$3\mathrm{.}50-$ $$1\mathrm{.}00=$ $$2\mathrm{.}50$ per share.Managerial Report$1.$ Build a $($spreadsheet$)$ model to calculate the profit of this European put option. $($Hint: Follow the above to create the parameters and the formulas for Model$)2.$ Construct a data table that shows the profit per share for a share price in six months between $$10$ and $$30$ per share in increments of $$1\mathrm{.}00.$The point of purchasing a European option is to limit the risk of a decrease in the per$-$share price of the stock. Suppose you purchased $200$ shares of the stock at $$28$ per share and $75$ six$-$month European put options with an exercise price of $$26.$ Each put option costs $$1\mathrm{.}3.$ Build a $($spreadsheet$)$ model to show the value of the portfolio with options and without options. $($Hint: Follow the above to create the parameters and the formulas for Model$)4.$ Use data tables to shows the value of the portfolio with options and without options for a share price in six months between $$15$ and $$35$ per share in increments of $$1\mathrm{.}00.5.$ Discuss the portfolio profit with and without the European put options. Which one $($with or without$)$ is more profitable? Your submission of report should be a MS Excel file showing formulas.

A put option in finance allows you to sell a share of stock at a given price in the future. There are different types of put options. A European put option allows you to sell a share of stock at a given price, called the exercise price, at a particular point in time after the purchase of the option. For example, suppose you purchase a six$-$month European put option for a share of stock with an exercise price of $$26.$ If six months later, the stock price per share is $$26$ or more, the option has no value. If in six months the stock price is lower than $$26$ per share, then you can purchase the stock and immediately sell it at the higher exercise price of $$26.$ If the price per share in six months is $$22\mathrm{.}50,$ you can purchase a share of the stock for $$22\mathrm{.}50$ and then use the put option to immediately sell the share for $$26.$ Your profit would be the difference, $$26-$$$22\mathrm{.}50=$$$3\mathrm{.}50$ per share, less the cost of the option. If you paid $$1\mathrm{.}00$ per put option, then your profit would be $$3\mathrm{.}50-$ $$1\mathrm{.}00=$$$2\mathrm{.}50$ per share.

$\backslash$table$[[$A$,$A$,$B$],[1,$European Put Option,$],[2,,],[3,$Parameters,$],[4,$Costs of Put Option,$$1\mathrm{.}00$