Consider the following option strategy that shorts $($sells$/$writes$)$ a "Straddle" on the company Eli Lilly $($LLY$).$

A$.$ Short one call option on LLY with time to expiration T and strike price $x1=$$$50.$

B$.$ Short one put option on LLY with time to expiration T and strike price X$2=$ $$50.$

$($a$)$ In a table such as the one below, fill out the payoffs of the components A and B of the short Straddle strategy listed above. Remember that payoffs do not take into account the cost of the options, while the net profit does. The top row of the table indicates five scenarios for the price of LLY stock at the expiration time T$.$

$($b$)$ Draw below a diagram containing:

the total payoff of the short Straddle strategy over the price of the LLY stock at expiration T$.$

a dashed line that indicates $($roughly$)$ what the net profit of this strategy is compared to the total payoff.

$($c$)$ Eli Lilly is expected to release new results from a safety trial on the long$-$term health effects of their blockbuster weight loss drug Mounjaro between today and the expiration time T$.$ You don't know if the results will be good or bad, but you don't believe that the price of Eli Lilly stock will move more than $10\%$ up or down between now and time T from its current price, which is $$50.$ The price of the Straddle is $$7.$ Should you buy or sell the Straddle? Briefly explain why.

$($a$.)$ Table: create and fill in a table such as the one below in your work

$\backslash$table$[[$Stock price:,$30,40,50,60,70],[$Payoff of A$,,,,,],[$Payoff of B$,,,,,],[$Total payoff,,,,,$]]$

$($b$).$ Diagram: draw the diagram in your work