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solve both for like 6. Consider the following portfolio. You write a put option with exercise price 90 and buy a put option on the

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6. Consider the following portfolio. You write a put option with exercise price 90 and buy a put option on the same stock with the same expiration with exercise price 95. a. Plot the value of the portfolio at the expiration date of the options. b. On the same graph, plot the profit of the portfolio. Which option must cost more? 7. You buy a share of stock, write a 1-year call option with X = $10 and buy a 1-year put option with X = $10. Your net outlay to establish the entire portfolio is $9.50. a. What is the payoff of your portfolio? b. What must be the risk-free interest rate? (The stock pays zero dividends.) 6. Consider the following portfolio. You write a put option with exercise price 90 and buy a put option on the same stock with the same expiration with exercise price 95. a. Plot the value of the portfolio at the expiration date of the options. b. On the same graph, plot the profit of the portfolio. Which option must cost more? 7. You buy a share of stock, write a 1-year call option with X = $10 and buy a 1-year put option with X = $10. Your net outlay to establish the entire portfolio is $9.50. a. What is the payoff of your portfolio? b. What must be the risk-free interest rate? (The stock pays zero dividends.)

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