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Suppose that a trader bought a Put option on a Crude Oil Futures contract. The strike price, SP = $45/barrel. and the Put premium paid,
Suppose that a trader bought a Put option on a Crude Oil Futures contract. The strike price, SP = $45/barrel. and the Put premium paid, P = $5/barrel. The size of Crude Oil Futures contract is 1,000 barrels. One day, the market price of the Crude Oil Futures contract appears to be FP= $42/barrel. If the Put holder decides to exercise the option, her net profit/loss would be:
A. +2000
B.-2000
C. +3000
D.-3000
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