Please refer to HW_data.doc for quotes on Intel stock options. Consider the following positions on the Intel stock. For each of the positions choose the strike X = $45. Choose January option. a. Short 1 call. b. Short 1 put. c. Short 1 call + long 1 put. d. Long 1 call + long 1 put. e. Long 1 put with strike $45 and short 1 put with strike $46. f. Long 1 put with strike $44, short 2 puts with strike $45, and long 1 put with strike $46. Assume that you enter and close the positions at the mid point of bidask spread. Assume that you trade each contract on November 1 (Le. enter the positions). For each position (af) answer the following questions: 1. Close out your positions on November 8. Calculate your net dollar gain or loss. 2. Now assume that you exercise options on November 8. For each position compute your net gain or loss. 3. For each position draw the payoff diagram, marking the strikes and the stock price on November 8 clearly, as well as your gain or loss. a) Short 1 call On Nov 1, Jan call price = 2.025, on Nov 8, Jan call price = 2.67 If entered position on Nov 1 and closed out on Nov 8, net loss: (2.67 2.025) * 100 = $54.5 Alternative solution: Time 0: $2.025 * 100 = $202.5 Nov 8: $2.67* 100 = $267 Total = $202.5 - $267 = -$64.5 (loss) If exercise options on Nov 8: Time 0: +$2.025 *100 = $202.5 Time Nov 8: Payoff = -max ((46.48 - 45),0) * 100 = -$148 Total = $202.5 - $148 = $54.5 (gain)