A PUT and a CALL option are written on a stock with a strike price of $60. The options are held until expiration.

17. Calculate the breakeven stock price for the CALL option if the premium is $16. What is the time value of the call? a) $63; $1 b) $57; $0 c) $76; $16 d) $55; $3 e) $76; $1 f) None of the above

18. Suppose the stock price at expiration is $75. Call premium is $16. The CALL option WRITERS profit would be: a) -$3 b) $3 c) -$15 d) $15 e) None of the above

19. Suppose the stock price at expiration is $75. Call premium is $16 and Put premium is $3. The CALL option will ___ because the call is ___. But the PUT option will ___ because the put is ___, with a TIME VALUE of ___. a) Be exercised; in-the-money; not be exercised; out-of-the-money; zero b) not be exercised; out-of-the-money; be exercised; in-the-money; zero c) Be exercised; in-the-money; not be exercised; out-of-the-money; 1 d) Be exercised; in-the-money; be exercised; in-the-money; zero e) None of the above is correct