XYZ stock is trading at $100 (and pays no dividends). The effective 3-month interest rate r = 1% for all the following questions. Also, I highly recommend you use a spreadsheet, its so much easier! You can refer to the spreadsheet posted along with the assignment, but be sure you build your own (and that you can sketch the answers with pen and paper like on the midterm/final.)

3 month options on XYZ are trading at the following prices (no bid/ask spread!):

Strike Price	Call Price	Put Price
95	7.55	1.60
100	4.49	3.49
105	2.39	6.3

Construct profit and payoff diagrams for the following:

a) Long a 105 strike straddle.

b) Short a 95 strike straddle.

c) Combine a) and b) in a single portfolio.