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Assume that you have shorted a call option on Intuit stock with a strike price of $35; when you originally sold (wrote) the option, you
Assume that you have shorted a call option on Intuit stock with a strike price of $35; when you originally sold (wrote) the option, you received $5. The option will expire in exactly three months time. a. If the stock is trading at $41 in three months, what will your payoff be? What will your profit be? b. If the stock is trading at $23 in three months, what will your payoff be? What will your profit be? c. Draw a payoff diagram showing the amount you owe at expiration as a function of the stock price at expiration d. Redo (c), but instead of showing payoffs, show profits
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