You would like to use Saraleu.com's call and put options to take advantage of your expectation that Saraleu's stock price will not be deviating from the current price of $40 per share.The prices of Saraleu'sput option and call optionwith the same exercise price of $40 and the same expiration date are$3 and$4, respectively. You will be making_____________ if you long a straddle andthe stock price is $45 per share at the expiration.

Multiple Choice

a) a loss of $500

b) a loss of $200

c) a profit of $100

d) a loss of $700

e) a profit of $500