Question
A trader creates a long butterfly spread from options with strike prices $60, $65, and $70 by trading a total of 4 100-share options. The
A trader creates a long butterfly spread from options with strike prices $60, $65, and $70 by trading a total of 4 100-share options. The options are worth $4, $8, and $15 respectively. What is the maximum net loss (after the cost of the options is taken into account)?
| a. | $400 | |
| b. | $200 | |
| c. | $100 | |
| d. | $300 |
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Intermediate Financial Management
Authors: Eugene F Brigham, Phillip R Daves
9th Edition
032431986X, 9780324319866
