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You buy a call with a strike price of $60 on a stock that you have shorted at $60 (this is a protective call). The
You buy a call with a strike price of $60 on a stock that you have shorted at $60 (this is a "protective" call). The call premium is $2.80. a. What is the expiration net profit if the stock price ends at $0,$30,$60,$70, and $1000? b. What is the maximum potential loss from this protective call? c. What is the maximum potential gain from this protective call? d. Find the break even stock price(or prices)
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