1. For the following options on Dec 18 corn futures, calculate the breakeven point and draw...

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1. For the following options on Dec 18 corn futures, calculatethe breakeven point and draw the pay-off diagram.
a) Writing a put with a $4.00 strike price and a premium of$0.27
b) Holding a put with a $4.00 strike price and a premium of$0.27
c) Writing a call with a $4.10 strike price and a premium of$0.18
d) Holding a call with a $4.10 strike price and a premium of$0.18

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S Stock price at expiration K strike price C Callpremium P Put premiumNet gain loss from writing a put option P max K S0Net gain loss from holding a put option max K S 0 PNet gain loss from writing a call option C max S K0Net gain loss from holding a call option max S K 0 Ca Writing a put with a 400 strike See Answer

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1. For the following options on Dec 18 corn futures, calculatethe breakeven point and draw the pay-off diagram.a) Writing a put with a $4.00 strike price and a premium of$0.27b) Holding a put with a $4.00 strike price and a premium of$0.27c) Writing a call with a $4.10 strike price and a premium of$0.18d) Holding a call with a $4.10 strike price and a premium of$0.18