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Bruce bought a 6-month naked put option on XYZ with a strike of $50 and the shares are trading at $48.50, the price of the
Bruce bought a 6-month naked put option on XYZ with a strike of $50 and the shares are trading at $48.50, the price of the option was $4.25.
a) Calculate the intrinsic value
b) Calculate the time value.
c) At what price would the shares have to trade for Bruce would start to make money?
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