Suppose you buy a straddle by purchasing one Facebook $290 call option contract quoted at $5 and purchasing one Facebook $280 put option contract quoted at $3.5, where $290 and $280 are the strike prices for the call and put options, respectively. The two options have the same expiration date.

A) If the Facebook stock price is $270 at expiration, what is your total payoff from the straddle? What is your profit (loss)? (6 points)

B) What is your largest loss from buying this straddle? (4 points)