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Options on the NYSE stock index: Option Strike price ($) Premium ($) Call 45 4 Call 55 2 Construct a bull spread using the options
Options on the NYSE stock index:
Option | Strike price ($) | Premium ($) |
Call | 45 | 4 |
Call | 55 | 2 |
Construct a bull spread using the options given above. Prepare a table showing the payoff and profit/loss for each option and for the bull spread.
[8 marks]
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