FIGURE 23.8 This strategy provides a payoff of $0 if the Google stock price remains at $460 and a payoff of $460 if Google's stock price either falls to zero or rises to $920. See Practice Problem 9. 9. Option Portfolios. Look at Figure 23.8, which shows the possible future payoffs in January 2011 from a particular package of investments. (LO1) a. What package of investments would provide you with this set of payoffs? b. How much would the package have cost you in July 2010? (See Table 23.2.) c. In what circumstances might it make sense to invest in this package? Incidentally, this package of investments is known as a "straddle" by option buffs. FIGURE 23.8 This strategy provides a payoff of $0 if the Google stock price remains at $460 and a payoff of $460 if Google's stock price either falls to zero or rises to $920. See Practice Problem 9. FIGURE 23.8 This strategy provides a payoff of $0 if the Google stock price remains at $460 and a payoff of $460 if Google's stock price either falls to zero or rises to $920. See Practice Problem 9. 9. Option Portfolios. Look at Figure 23.8, which shows the possible future payoffs in January 2011 from a particular package of investments. (LO1) a. What package of investments would provide you with this set of payoffs? b. How much would the package have cost you in July 2010? (See Table 23.2.) c. In what circumstances might it make sense to invest in this package? Incidentally, this package of investments is known as a "straddle" by option buffs. FIGURE 23.8 This strategy provides a payoff of $0 if the Google stock price remains at $460 and a payoff of $460 if Google's stock price either falls to zero or rises to $920. See Practice Problem 9