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Assume that att = 0 a stock has price S = $500 and that a call that matures at T with a strike price of

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Assume that att = 0 a stock has price S = $500 and that a call that matures at T with a strike price of X = $500 has premium C = $10. Assume at the option's maturity, t = T, that ST = $550. Assume that at t=0 that investor #1 buys 100 shares of stock and sells them at t= T. Assume that at t = 0 investor #2 buys one call option on the same stock and exercises it at t =T. What is the ROI (return on investment) for investor #2? 400%

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