Consider an exchange- traded call option contract to buy 500 shares with a strike price of $40

Question:

Consider an exchange- traded call option contract to buy 500 shares with a strike price of

$40 and maturity in four months. Explain how the terms of the option contract change when there is

a. A 10% stock dividend

b. A 10% cash dividend POL78

c. A 4-for-1 stock split

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