Explanation

When an investor sells a put option:

• They receive the premium upfront (put price = 15)
• They have an obligation to buy the underlying asset at the exercise price if the option is exercised

Given:

• Put price (premium received) = 15
• Exercise price = 250
• Underlying price at expiration = 260

Analysis:

1. At expiration, the put option will be out-of-the-money because:

   • Underlying price (260) > Exercise price (250)
   • The put option gives the holder the right to sell at 250, but they can sell in the market at 260, so they won't exercise

2. Since the option expires worthless:

   • The seller keeps the entire premium received
   • No obligation needs to be fulfilled

Profit calculation:

• Premium received = 15
• No exercise → no additional cash flows
• Total profit = 15

Why not other options:

• Option A (5): Would be incorrect - this might be calculated as (260 - 250) - 15 = -5, but that's for the buyer's perspective
• Option B (10): Would be incorrect - this might be calculated as 260 - 250 = 10, but that ignores the premium received
• Option C (15): Correct - seller keeps the entire premium when option expires worthless

Key concept: For option sellers, profit is limited to the premium received when the option expires out-of-the-money.