III: Problems: Assume that the stock is currently trading at $20 per share and options and bonds have the prices given in the table below. Strike (K) 15 20 Call Premium Put Premium 2.6 6.9 1. (10 points) If you long a call with strike 15 a) Sketch the payoff and profit diagrams for the strategy. b) Describe the profitable range in terms of the price of the underlying security. c) Describe the maximum potential profits and losses 2. (10 points) If you short a call with strike 15 a) Sketch the payoff and profit diagrams for the strategy b) Describe the profitable range in terms of the price of the underlying security. c) Describe the maximum potential profits and losses