question 2

exercise value: A. 2.63 B. 0 C. 7.02 D. 4.39

Optional Premium: A. 4.39 B. 7.02 C.0 D. 2.63

question 3

New exercise value: A. 4.39 B. 2.63 C. 0 D. 2.98

New Option Premium: A. 2.63 B. 4.39 C. 0 D. 2.98

A call option gives its owners the right, but not the obligation, to: O Buy a commodity at a specified price and future date, at which physical delivery occurs O Sell a specified number of shares at a certain price within a specified period of time O Buy a specified number of shares at a certain price within a specified period of time O Sell a commodity at a specified price and future date, but physical delivery does not occur A call option on a single share of Dernham Inc.'s common stock has a market price of $7.02 and expires in six months. The option has an exercise, or strike, price of $68.00, and the current stock price is $72.39. Select the correct exercise value and option premium for this call option in the following table Exercise Value Option Premium Suppose the stock's price fell to $67.22 and the option's market price fell to $2.98. Indicate the option's new exercise value and the new value of the option premium in the following table: New Exercise Value New Option Premium