An investor wants to buy some options to make sure that the value of his portfolio does not drop below $2,000. He owns 100 shares of LUV stock. The current market price of LUV is $35 per share. How much will he spend to hedge this stock using options? The following options are traded on this stock:

Expiration dateExercise priceCall pricePut price 1-Jun-2017 1-Jun-2017 1-Jun-2017 1-Jun-2017 20 25 35 40 18.00 11.35 3.50 0.75 0.10 0.45 3.20 5.65 Section a answers: stock value on Jun2017 Value of 100 shares d Value of 100 Put(X-20) Total 10 15 20 25 30 35 40 45