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20-6. Please see attached. I need the answers and excel formats. Thank you Problem 20-6 You own a call option on Intuit stock with a
20-6. Please see attached. I need the answers and excel formats. Thank you
Problem 20-6 You own a call option on Intuit stock with a strike price of $40. The option will expire in ex months. a. If the stock is trading at $55 in three months, what will be the payoff of the call? b. If the stock is trading at $35 in three months, what will be the payoff of the call? c. Draw a payoff diagram showing the value of the call at expiration as a function of the expiration. Strike Price $40.00 a. If the stock is trading at $55 in three months, what will be the payoff of the call? Spot price in 3 months $55.00 Exercise value of call b. If the stock is trading at $35 in three months, what will be the payoff of the call? Spot price in 3 months $35.00 Exercise value of call c. Draw a payoff diagram showing the value of the call at expiration as a function of the expiration. Spot Price ($) Exercise Value ($) Requirements 1. In cell E15, by using cell references, calculate the amount that you will owe (1 pt.). 2. In cell E21, by using cell references, calculate the exercise value of the call (1 pt.). 3. To graph the diagram showing the exercise value of the call as a function of the stock need to generate a table of exercise values as a function of the stock prices at expirati price of 0 in cell C26 (1 pt.). In cell C27, by using cell references, increase the previo pt.). Copy and paste cell C27 onto cells C28:C45 (1 pt.). 4. You will use the function IF to compare the stock price to the strike price and calcula cell D26, by using the function IF and absolute and relative cell references, compare greater than the strike price; if true, input the difference between the strike price and t input 0 (1 pt.). Copy and paste cell D26 onto cells D27:D45 (1 pt.). To graph the diagram, insert a 2D-line chart that fills the cell range F25:M35. As the 5. prices on the horizontal axis and the exercise value on the vertical axis (1 pt.). As the Stock Price at Expiration ($) (1 pt). As the vertical label, input Exercise Value ($) input Exercise Value of a Call Option at Expiration (1 pt.). If necessary, resize the F25:M35. he option will expire in exactly three the payoff of the call? the payoff of the call? piration as a function of the stock price at the payoff of the call? the payoff of the call? piration as a function of the stock price at that you will owe (1 pt.). value of the call (1 pt.). l as a function of the stock price at expiration, you the stock prices at expiration. Start with a stock erences, increase the previous stock price by 5 (1 the strike price and calculate what you will owe. In e cell references, compare whether the stock price is tween the strike price and the stock price; if false, 45 (1 pt.). ell range F25:M35. As the data source: plot the stock vertical axis (1 pt.). As the horizontal label, input input Exercise Value ($) (1 pt.). As the chart title, t.). If necessary, resize the chart to fill the cell rangeStep by Step Solution
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