b-2, b-3, c-2

Refer to the stock options on Microsoft in the Figure 2.10. Suppose you buy a September expiration call option on 100 shares with the xcise price of $140. Requlred: a-1. If the stock price at option expiration is $141, will you exercise your call? Yes No a-2. What is the net profit/oss on your position? (Input the amount as a positive value.) Answer is complete and correct. a-3. What is the rate of return on your position? (Negative value should be indicated by a minus sign. Round your answer to 2 decimal places.) b-1. Would you exercise the call if you had bought the September call with the exercise price $135 ? Yes No b-2. What is the net profitloss on your position? (Input the amount as a positive value.) Answer is complete but not entirely correct. Net profit Q of $401 b-3. What is the rate of return on your position? (Negative value should be indicated by a minus sign. Round your answer to 2 decimal places.) c-1. What if you had bought the September put with exerclse price $140 instead? Would you exercise the put at a stock price of $140? Yes No c-2. What is the rate of return on your position? (Negative value should be indicated by a minus sign.) FIGURE 2.10 Stock options on Microsoft, September 4, 2019 Note: Microsoft stock price on this day was $137.49. Source: Compiled from data downloaded from Yahoo! Finance