Question
Assume that a stock is selling at a price of $100. The 95 call option on the stock sells for $5 and the 105 put
Assume that a stock is selling at a price of $100. The 95 call option on the stock sells for $5 and the 105 put option sells for $8.
What is the intrinsic and time value on the 95 call and $105 put?
If the stock increases to $110, what will be the dollar and percentage return on the call option. What will be the return on the put option?
Assume that the investor writes a call option on the above stock. What will be the investors gain or loss if the stock closed at $100?
Assume that the investor writes a put option on the above stock. What will be the gain or loss if the stock sells for $110?
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