Question #8: Option Strategies Suppose you currently own 3,000 shares of AZZ Incorporated stock that you purchased for $50 per share. You are planning to hold on to the shares until next year and...

Extracted text: Question #8: Option Strategies Suppose you currently own 3,000 shares of AZZ Incorporated stock that you purchased for $50 per share. You are planning to hold on to the shares until next year and would like to protect yourself from possible fluctuations in the stock price. You decide to limit the risk by selling (writing) thirty call options with a strike price of $53.50 at a premium of $2.50. At the same time you purchase thirty put options with a strike price of $46 with a premium of $4. (a) What is the option strategy that you have decided to employ? (b) Calculate the total profit of this strategy if the price of AZZ stock next year is at (i) $38 (i1) $49 (iii) $117