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Consider stock XYZ with a current price of $100. XYZ does not pay dividends. The following table provides you the call and put options information
Consider stock XYZ with a current price of $100. XYZ does not pay dividends. The following table provides you the call and put options information written on this stock. Long the call options with strike prices $90 and $110 and short two call options with strike price $100. Show the payoff and profit diagram. (The continuously compounded risk-free interest rate is 5%.)
Strike price Call price 90 14.63 100 6.80 110 2.17Step by Step Solution
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