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Suppose that you write a put contract with a strike price of $40 and an expiration date in 3 months. The current stock price is

Suppose that you write a put contract with a strike price of $40 and an expiration date in 3 months. The current stock price is $41 and the contract is on 100 shares.

(a)Draw profit diagram for yourself and your counterparty. (

b) Are you in long or short position on the underlying asset?

(c)Are you in long or short position on the option?

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