We assume an index price of $1200, a 9% effective 6-month interest rate, and premiums of $86.37 for the 1075-strike 6-month call and $62.26 for the 1075-strike 6-month put. Suppose that you buy the S&R index, buy a 1075-strike put, and borrow $1036.16.

(a) Compute the total payoff if the index price is $1075 at expiration.

(b) Compute the total profit if the index price is $975 at expiration.