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You shorted a call option on Intuit stock with a strike price of $36. When you sold (wrote) the option, you received $7. The option
You shorted a call option on Intuit stock with a strike price of $36. When you sold (wrote) the option, you received $7. The option will expire in exactly three months' time. a. If the stock is trading at $44 in three months, what will your payoff be? What will your profit be? b. If the stock is trading at $22 in three months, what will your payoff be? What will your profit be? c. Draw a payoff diagram showing the payoff at expiration as a function of the stock price at expiration. d. Redo c, but instead of showing payoffs, show profits. a. The payoff of the short is $, and the profit of the short is $ (Round to the nearest dollar.) d. Choose the correct diagram below. A. B. C. D
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