Question
1) Suppose I buy one CALL option on Wendy's with a strike price of $20.50.The option premium is $11.00. Suppose the price of Wendy's is
1) Suppose I buy one CALL option on Wendy's with a strike price of $20.50.The option premium is $11.00. Suppose the price of Wendy's is $35.00 a share and I choose to exercise the option. What are my total gains or losses?
| A. | Profit $350.00 | |
| B. | Loss $350.00 | |
| C. | Profit $1,450.00 | |
| D. | Loss $1,450.00 |
2) Suppose I buy one PUT option on Walmart with a strike price of $94.The option premium is $1.14. Suppose the price of Walmart is $91.50 a share and I choose to exercise the option. What are my total gains or losses?
| Profit $250.00 | ||
| Loss of $250.00 | ||
| Loss of $136.00 | ||
| Profit of $136.00 |
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Accounting for Decision Making and Control
Authors: Jerold Zimmerman
9th edition
978-1259564550
