Turn back to Table 2.6 and look at the Microsoft options. Suppose you buy an August expiration

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Turn back to Table 2.6 and look at the Microsoft options. Suppose you buy an August expiration call option with exercise price $285.

a. Suppose the stock price in August is $288. Will you exercise your call? What is the profit on your position?

b. What if you had bought the August call with exercise price $280?

c. What if you had bought a August put with exercise price $280? L658

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ISE Investments

ISBN: 9781266085963

13th International Edition

Authors: Zvi Bodie, Alex Kane, Alan Marcus

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