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Martin gets into a long European call option to purchase one share of stock X for $95 that costs $5 and is held until maturity.
Martin gets into a long European call option to purchase one share of stock X for $95 that costs $5 and is held until maturity. Under what circumstances will Martin make a profit? Under what circumstances will the option be exercised? Draw a diagram illustrating how the profit from a long position in the option depends on the stock price at maturity of the option.
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