Problem 2: Following are the option prices for calls and puts for Amazon (AMZN) with June 16, 2017 expiration date. Suppose that you are bullish on Amazon and would like to own more of the stocks. However, you do not want to buy AMZN at its current price and instead, you would be happy to own AMZN at $972.50 per share. However, if AMZN costs more than $972.50, you do not wish you own the stock. You currently have 150 shares and you have $97,000 in cash. What type of options would you trade and why? How many contracts would you be able to trade? What is the total premium paid and/or received? Calls & Puts Calls Expand All Collapse All In the Money Near the Money Puts Out of the Money Jun 16, 2017 (23 days until expiration) Bid/ Bid Size Ask/ Ask Size Volume/ Open Int 19.80 4 20.00 9 395 Change/ % Change 2.86 Strike Price Pos. Expiration 970.00 1,462 16.82% Jun 16, 2017 18.20 18.75 102 71 59 80 2.68 17.20% 972.50 Jun 16, 2017 16.80 17.25 35 8 448 2,729 2.45 975.00 16.78% Jun 16, 2017 Pos. Bid/ Bid Sze Ask/ Ask Size Volume/ Open Int Change/ % Change 11.45 9 11.80 7 270 572 12.45 12.85 57 -3.72 (23.69)% -2.70 6 20 16 (16.58)% 13.35 13.90 235 -3.45 1 1 244 (20.06)% 977.49 Underlying Last Price 15.55 15.90 99 1.80 977.50 14.70 15.10 31 -4.77 6 16 87 13.14% Jun 16, 2017 14.20 14.60 445 2.18 980.00 26 17 1,543 17.72% Jun 16, 2017 7 15.00 9 27 1 (23.90)% 16.35 50 -3.88 38 633 (19.01)% 13.05 13.35 7 2.09 982.50 17. 5 17.65 1 17.45 10 7 20 19.16% Jun 16, 2017 5 15 0 0.00%