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Consider the following statements: Forward contract buyer: ST F Call option buyer: Max (ST X, 0) Put option buyer: Max (X ST, 0) Explain the

Consider the following statements:

Forward contract buyer: ST F

Call option buyer: Max (ST X, 0)

Put option buyer: Max (X ST, 0)

Explain the three statements and extend the discussion to address the position of the

seller in each case. [Diagrams and examples must be used.

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