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please help me An exercise option priced at $ 25, maturing 6 months, currently selling for $ 4. The option relies on a stock that
please help me
An exercise option priced at $ 25, maturing 6 months, currently selling for $ 4. The option relies on a stock that sells for $ 26. a. What is the value of the purchase option? b. What will be the value of the maturity buy option if the stock price at that date were: $ 20, $ 25, $ 30, and $ 40 c. If the stock price reaches $ 40 at maturity what will be the percentage increase in the value of the buy option? d. If the investor were to buy the stock and sell the buy option, what would be the profit / loss from this strategy if the stock price were $20, $ 26 and $ 40Step by Step Solution
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