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Please answer all questions above. 1) True or False? Buying a call and selling a put is an example of a spread. 2) What is

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Please answer all questions above.

1) True or False? Buying a call and selling a put is an example of a spread. 2) What is a bear spread? When might such an approach be appropriate? 3) Construct profit diagrams for a bear spread with 950 and 1107 strikes using the table of premiums on page 86 of the textbook (Note the 6-month effective interest rate is 2 %).

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