Question
b. A stock that is currently selling for $47 has the following six-month options outstanding: Strike...
b. A stock that is currently selling for $47 has the following six-month options outstanding:
|
Strike Price |
Market Price |
|
|
Call Option |
$45 |
$4 |
|
Call Option |
$50 |
$1 |
- Which option(s) is (are) in the money?
- Which option(s) is (are) at the money?
- Which option(s) is (are) out of the money?
- What is the profit (loss) at expiration given different prices of the stock ($30, $35, $40, $40, $45, $50, $55, and $60) if the investor buys the call with $50 strike price?
- What is the profit (loss) at expiration given different prices of the stock ($30, $35, $40, $40, $45, $50, $55, and $60) if the investor buys the call with $45 strike price?
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