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Suppose that put options on a stock with strike prices $30 and $35 cost $4 and $7, respectively. You create a bull spread by combining
Suppose that put options on a stock with strike prices $30 and $35 cost $4 and $7, respectively. You create a bull spread by combining a long position on the put with the low strike price and a short position on the put with the high strike price. Construct both the table and the graph that shows the profit for this spread at expiration. Specify the stock prices for which youll have a profit, and the prices for which youll have a loss. What is your maximum profit? What is your maximum loss?
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