Donna Donie, CFA, has a client who believes the common stock price of TRT Materials $($currently $$58$ per share$)$ could move

substantially in either direction in reaction to an expected court decision involving the company. The client currently owns no TRT

shares, but asks Donie for advice about implementing a strangle strategy to capitalize on the possible stock price movement. A

strangle is a portfolio of a put and a call with a higher exercise price but the same expiration date. Donie gathers the TRT option$-$

pricing data:

a$.$ Recommend whether Donie should choose a long strangle strategy or a short strangle strategy to achieve the client's objective.

Long strangle strategy

Short strangle strategy

b$.$ Calculate, at expiration for the appropriate strangle strategy in part $($a$),$ the $($Enter your Break$-$even stock price$($s$)$ answers in

ascending order. Enter all values as positive value. Omit the $"$$$"$ sign in your response.$)$

i$.$ Maximum possible loss per share

ii$.$ Maximum possible gain per share

iii. Break$-$even stock price$($s$)$