Problem 1 (24 points) An investor is considering buying a put option for stock ABC with the following parameters: Exercise price of the put option is $170, initial stock price $165, put option price $8. A. Define payoff and profit function and provide payoff and profit formulae for the put option buyer at maturity with respect to stock price at expiration. (6 points) 1 B. Define payoff and profit function and calculate the payoff and profit for a protective put position at maturity when the stock price is $180 at expiration. (12 points) a For Evev 33 AaBbCcDDE AaBbCcDc AaBb CcD AaBbCcDdE Emphasis Heading 1 Heading 2 Normal 3 C. Discuss why the stock owner should implement the protective put strategy as opposed to only buying the underlying stock. (6 points)