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And this 81. Suppose that you purchased a conventional call option on growth in Non-Farm Payrolls (NFP) with an exercise price of 209,000 jobs. The
And this 81. Suppose that you purchased a conventional call option on growth in Non-Farm Payrolls (NFP) with an exercise price of 209,000 jobs. The NFP conventional contract pays out $100 for every job created in excess of the exercise price.
Required:
a. What is the value of the option if job growth is 194,000? (Enter 0 if the option value is zero.)
b. What is the value of the option if job growth is 216,000?
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