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Question 2 The current price of a share of stock is $40. Connie sells 100 one-year put options at $38.50. She receives a premium of

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Question 2 The current price of a share of stock is $40. Connie sells 100 one-year put options at $38.50. She receives a premium of $1.25 for each option. The stock loses 90% of its value over a year. What is Connie's total loss at time 1? Assume the risk free rate is 5% per year effective

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