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An investor with $2,000 to invest feels that a stock price will increase over the next two months. The current stock price is $20 and
An investor with $2,000 to invest feels that a stock price will increase over the next two months. The current stock price is $20 and the price of a 2-month call option with a strike price of $22.50 is $1. If the investor chooses to invest all money in call options, what is the profit or loss if the stock price is $30 or $10 two months later?
- $13,000 and $-2,000
- $15,000 and $25,000
- $13,000 and $-27,000
- $15,000 and 0
Please explain
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