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Microsoft Word - FINA471ProblemSet1 A one-year call option on a stock with a strike price of $30 costs $3; a one-year put option on the

Microsoft Word - FINA471ProblemSet1

A one-year call option on a stock with a strike price of $30 costs $3; a one-year put option on the stock with a strike price of $30 costs $4. Suppose that a trader buys two call options and one put option. What is the breakeven stock price below which the trader will make profit?

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