What is the maximum loss on your position

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Reference no: EM13923042

You bought 100 Google Shares for $400. You also bought 1 put option on Google with a strike of $395 for $20.

a) What is the maximum loss on your position?

b) What is the profit on your position when the stock hits $440?

c) Draw the profit/loss diagram for this position clearly marking the maximum loss, and breakeven.

Reference no: EM13923042

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