Question

3 question (15%). a Draw a profit or loss graph for call writer with an exercise price of S55 for which a S6 premium is paid. b. Identify break-even point, maximum profit, and maximum losses.
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Answer #1

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Profit or loss graph is drawn and part b is answered in the graph.

Pro.ft: -max (-x,)+Premtium sTz 50 ST55 Pobfit--, max (65-55, o) + 6-4 个Psoft eak even point) Pst fit- 45 50 55 co\\65-1。

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