Question: Question 3 : Solve the question (35 points) Suppose you bought 50 shares of the company BETA at the price $35 per share. A). If
Question 3 : Solve the question (35 points) Suppose you bought 50 shares of the company BETA at the price $35 per share. A). If the stock price goes up to $42 per share, what is the percentage return of your investment? (5 points) B). In the same example, suppose we bought a call option for $100. The strike price is $35. If the stock price is $50 just before the option expires, should you exercise the option? What is the amount of your profit? What is you percentage return? (25 points) C). What is the amount of gain/loss if you don't exercise? (5 points)
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