Question 13

Question 13 of 15 >

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Suppose that Mr. A writes a July option on February 13, 2010 to BUY 100 stocks of ABC company from Mr. B in December 2010 at price $50. Mr. B paid $0.7 as option price per share to Mr. A. The option is exercisable any time until maturity. The prices of the underlying stock are $45 and $48 in September 2010 and at maturity respectively. Using the above information fill in the following blanks.

what kind of option is it?

In September. the option is in-the-money. at-the-money or out-of-the-money

What will be the spot price of the option if it is out-or-te money in November 2010

The long position holder in the option IS Mr.

What will be total pay off from the option in September 2010? $

What kisct ef optin is it What kisct ef optin is it