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The current price of one share of GBP stock is 50.00. Aaron Rodgers purchases (long) a...

  1. The current price of one share of GBP stock is 50.00. Aaron Rodgers purchases (long) a call option on GBP stock with a strike price of 53.00 and one-year to maturity. The price of the option is 4.95. The continuously compounded risk free rate is 4%.

  1. What is Aaron’s profit at the end of one year if the stock price at that time is 60.00 per share?

  1. What is Aaron’s profit at the end of one year if the stock price at that time is 40.00 per share?

  1. What is the breakeven stock price of his portfolio?

  1. What is the minimum profit of his portfolio?

  1. What is the maximum profit of his portfolio?
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