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A call option has an exercise price of $80. At the exercise date, the stock price could be either $40. or $120. Which of the
A call option has an exercise price of $80. At the exercise date, the stock price could be either $40. or $120. Which of the following investment strategies (disregarding the cost of building such a portfolio) provides the same payoff as the stock, at maturity? A. Borrow $40 and sell two calls. B. Borrow $40 and buy two calls. C. Lend (put in bank) PV of $40 and sell two calls. D. Lend (put in bank) PV of $40 and buy two calls
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