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Question 2. Suppose K = = 100, K 120 and K3 = 140. Suppose all options are European and have the same maturity and underlying

Question 2. Suppose K = = 100, K 120 and K3 = 140. Suppose all options are European and have the same maturity and underlying asset. Consider the following portfolios Portfolio A: short 2 calls with strike price K, buy one call with strike price K, buy one call with strike price K3. Portfolio B: short 2 puts with strike price K2, buy one put with strike price K, buy one put with strike price K3. Use the put-call parity to show that the values of the above portfolios are equal.
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Question 2. Suppose K1=100,K2=120 and K3=140. Suppose all options are European and have the same maturity and underlying asset. Consider the following portfolios Portfolio A: short 2 calls with strike price K2, buy one call with strike price K1, buy one call with strike price K3. Portfolio B: short 2 puts with strike price K2, buy one put with strike price K1, buy one put with strike price K3. Use the put-call parity to show that the values of the above portfolios are equal.|

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