The correct answer is: Graph B.

A put option is the right to sell shares at a fixed price, here $2,000 or $2 per share. The option has value for the investor at the expiration date provided that the actual market value is less than $2,000, giving the investor the ability to 'profit' by exercising the option. This is shown by Graph B.

Graph A shows how the value at expiration date of a call option for 1,000 shares at $2 each varies with the actual share price. Graph D shows the combined value of the option plus the 1,000 shares: the put option safeguards the investor against a fall in price of the shares below $2,000, which illustrates the advantage of put options to an investor seeking to hedge against share price falls.

For put options and call options before their expiration date, the lines in Graph B and Graph A respectively show the minimum values at which the options will be traded.