SHOW YOUR WORK The Company uses a lot of oil in their production process. Due to the unique nature of their contracts, they hedge oil price movements by entering long straddle positions (long call and long put). Currently the spot price of crude oil is $36.00 . For options with a strike of 30 the call price is $7.30 and put price is $1.00 . Choose the most accurate statement about outcomes.

a. When the price of crude at expiry is less than $21.7 then the losses from the put exceed the gains from the call

b. The only way the straddle loses money is if the price of crude at expiry is between $21.7 and $47.49

c. The straddle makes money whenever the price of crude at expiry exceeds $21.7

d. When the price of crude at expiry exceeds $38.3 losses from the call exceed the gains from the put

e. The straddle makes money whenever the price of crude at expiry is less than $21.7