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Suppose you executed the following trade (strategy) on NPR Ltd using two exercise prices: Long1 NPR call (X=R50)@ R8.40 Short 2 NPR calls (X=R60)@R3.34 each

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Suppose you executed the following trade (strategy) on NPR Ltd using two exercise prices: Long1 NPR call (X=R50)@ R8.40 Short 2 NPR calls (X=R60)@R3.34 each All options have identical expiration dates. A) What is the cost of initiating such a strategy? B) Graphically depict a fully-labelled Profit and Loss diagram of the strategy highlighting the break- even points, maximum potential profit and maximum potential loss. C) Under what market conditions will this strategy generally make sense? Explain Does the holder of this position have limited or unlimited liability? Explain

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