Answered step by step
Verified Expert Solution
Question
1 Approved Answer
1. You are the buyer of a put option which has a put premium of $2.30. The strike price is $83 and the underlying stock
1. You are the buyer of a put option which has a put premium of $2.30. The strike price is $83 and the underlying stock price is $82.50. What is your profit or loss?
a. Loss $230
b. Gain $50
c. Gain $230
d. Loss $180
e. None of the above.
2. You are the seller of a put option. The put premium is $5.50 and the exercise price is $105. If the underlying stock price is $110, what is your net gain or loss?
a. Gain $50
b. Loss $50
c. Gain $550
d. Loss $550
e. None of the above.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started