DONT NEED EXPLAINATION JUST THE ANSWERS TO ALL PLEASE !!!

7). Assume a convertible bond with a $1,000 face value is convertible into 80 shares of common stock. Conversion price is $12.50.

The market data for this convertible bond suggest that the bond has a conversion premium, which makes it out-of-the-money.

A. False

B. None of the above

C. Incomplete information

6). Based on the Black-Scholes model, in order to hedge 2,500 shares of stock, the number of calls to write should be approximately: N(d1)=0.548, N(d2)=0.4884

Theoretical price using the Black-Scholes model = $3.80

A. 2,500

B. 3,835

C. 6,402

D. None of the above

5). If you buy an American option, you can exercise it any time until expiration but you cannot sell the option itself before expiration.

A. False

B. You can sell it before expiration but you have to buy a similar option simultaneously

C. You can exercise it but you cannot offset

D. None of the above is completely correct

4). Suppose the underlying stock for an option contract is selling for $30. The option also has a strike price of $30 and will expire in 3 months. Which of the following is true regarding the option? (i) The call option is at the money (ii) The intrinsic value of the call is 0 (iii) The put option is at the money (iv) The intrinsic value of the put is 0 (v) Neither the call nor the put has any time value

A. i, iii, iv

B. iii, iv, v

C. ii, iii, iv, v

D. i, ii, iii, iv

3). In general, if an option is out-of-the-money, and the option has about 5 months to expire, the options time value will likely be

A. Greater than zero

B. Less than zero

1). A call option priced at $1.30 with a stock price of $12 and an exercise price of $12.50 gives the holder the right to buy the stock at?

A. $12.50

B. $12

C. $1.30

D. None of the above