Contemporary Engineering Economics 6th Edition by Chan Park

تمرين 8

An investor has a portfolio consisting of the following assets and instruments.
• A long-call option with K = $40 and a call pre­mium of $3 at the time of purchase.
• A short-put option with K = $45 and a put pre­mium of $4 at the time of purchase.
• Two short-call options with K = $35 and a call premium of $5 at the time of purchase.
• Two short-stock positions that cost $40 per share at the time of purchase.
Assume that each of these contracts has the same expiration date, and ignore the time value of money. If the stock price at expiration is S T = $60, what is the net profit of this portfolio?