3. 3. Futures options quotes [LO 23.4] Refer to Table 23.1 in the text to answer this...
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3. 3.
Futures options quotes [LO 23.4] Refer to Table 23.1 in the text to answer this question. Suppose you purchase the May 2020 call option on corn futures with a strike price of US$3.90. Each contract is for 5 000 bushels. Assume you purchased the option at the last price. How much does your option cost per bushel of corn? What is the total cost?
Suppose the price of corn futures is US$3.74 per bushel at expiration of the option contract. What is your net profit or loss from this position? What if corn futures prices are US$4.13 per bushel at expiration?
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