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NASDAQ Call option for EUR with exercise price of $1.2515/EUR has a premium of 0.07/EUR. If...

NASDAQ Call option for EUR with exercise price of $1.2515/EUR has a premium of 0.07/EUR. If you buy 1 contract and you hold this contract till the expiration date. On that date, the spot price for EUR is $1.1122/EUR, what is your dollar profit/loss including the premium you paid (for the whole contract)? If it is a loss of say 250, put -250 in your answer.

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Answer #1
Exercise Price $/EUR 1.2515
Premium $/EUR 0.07
Spot price on maturity $/EUR 1.1122
Investor bought the EURO call option i.e. C+
It means he has a bullish belief.
If the price of call is higher than the exercise price on maturity date then he will gain as he will sell his option at a higher price.
But if the price on maturity is lower then the exercise price then he will not exercise the option and restrict his loss to a minimum.
Since the price on maturity is lower then the exercise price, the option will lapse.
Loss on call option = $0.07/EUR
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