a-1. Suppose the stock price in June is $152.10. Will you exercise your call?

• Yes

• No

a-2. What is the profit (loss) on your position?

b-1. If you had bought the June call with exercise price $145, will you exercise your call?

• Yes

• No

b-2. What is the profit (loss) on your position? (Enter your answer as a positive value rounded to 2 decimal places.)

c-1. If you had bought the June put with exercise price $155, will you exercise your put?

• Yes

• No

c-2. What is the profit (loss) on your position? (Enter your answer as a positive value rounded to 2 decimal places.)

THIS IS ALL THE INFORMATION GIVEN.

Table 2.7 Expiration Strike Call 6.60 June June June Prices of stock options on IBM, May 10, 2016 3.31 1.27 145 150 155 145 150 155 Put 1.57 3.30 6.53 2.58 4.42 7.30 July 7.73 July July 4.43 2.28 Note: IBM stock on this day was $149.97. Source: Compiled from data downloaded from Yahool Finance, May 10, 2016