Perform the following analyses options on Lotuss common stock that mature in February 1994 and that have an exercise price of $55 per share.

1.Compute net profits and losses per share at maturity for the following five investment strategies:

Buying a call option on Lotuss stock.

Writing a call option on Lotuss common stock.

Buying a put option on Lotuss common stock.

Writing a put option on Lotuss common stock.

Buying a share of Lotuss common stock at $55 per share and hold it until Feb. 19, 1994.

2. For each of the investment strategies listed above, draw the graph relating possible profits and losses.