Investment strategy using european options

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Consider the following investment strategy using European options on Ford that expire in July. Write one call option with an exercise price of $ 170 (X=$170) currently priced at $10 Write another call option with an exercise price of $ 195 (X=$195) priced at $5 1) Plot the profit of this strategy? 2) Why would you follow this strategy? 3) What are the stock prices at which this strategy would break even?

Reference no: EM131084268

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