The common stock of the Avalon Corporation has been trading in a narrow range around $40 per share for months, and you believe it is going to stay in that range for the next 3 months. The price of a 3-month put option with an exercise price of $40 is $3.5, and a call with the same expiration date and exercise price sells for $4. Selling a straddle would generate a total premium income of _____.

Group of answer choices

None of the above

$700

$500

$300

$400