You own a call option on Intuit stock with a strike price of $42. When you purchased the option, it cost you $5.

The option will expire in exactly three months' time.

a. If the stock is trading at $57 in three months, what will be the payoff of the call? What will be the profit of the call?

b. If the stock is trading at $36 in three months, what will be the payoff of the call? What will be the profit of the call?

c. Draw a payoff diagram showing the value of the call at expiration as a function of the stock price at expiration.

d. Redo (c), but instead of showing payoffs, show profits.