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BUaND Corp. stock is currenthy selling for $72.39 per share. Options permit the holder to buy one share ot an exercise price of s65.00. These

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BUaND Corp. stock is currenthy selling for $72.39 per share. Options permit the holder to buy one share ot an exercise price of s65.00. These options will expire at the end of one year, When the option explres, BLaND Corp.'s stock will either be selling for 595.00 or $45.00. The range of BLAND Corp.'s ending stock prices is In contrast, the range of BLAND Corp.'s ending option payaffs is To construct a hidged portolio, the investor's goal is to have the portfolio payoff be the same if the stock goes up or down. Suppose Warren is planning on writing one coll option, how many shares of stock should he buy to set up the hedge? 0.30 shares 0.70 shares Q.40 shares 0.50 thares 0.60 shares If the investor decdes to go forward with creating this riakless hedge, the net payolf will be What will be the equilibrium price of the call option it the riskofree rate is 8 s? +16.24 +153y 317155 317i06

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