Question
Corona stock is selling at $70 per share. You bought a call option with exercise price of $65 with the expiration date in one year.
Corona stock is selling at $70 per share. You bought a call option with exercise price of $65 with the expiration date in one year. (a) On expiration date, stock price goes up to $80. How much is the payoff on expiration date? (b) On expiration date, stock price goes down to $60. How much is the payoff on expiration date? (c) T-bill currently yields 3 percent. what is the value of call option? Corona stock is selling at $70 per share. You bought a put option with exercise price of $75 and with expiration date in 3 months. (d) On expiration date, stock price goes up to $80. How much is the payoff on expiration date. (e) On expiration date, stock price goes down to $60. How much is the payoff on expiration date?
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