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QUESTION 4 (20 MARKS) a. The followings are the information of call and put options of Bestari's stock which is currently traded at RM6.00 per

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QUESTION 4 (20 MARKS) a. The followings are the information of call and put options of Bestari's stock which is currently traded at RM6.00 per share. 30 day Call 1tm Exercise Price (RM) 30 day Put Premium (RM) 0.70 Exercise Price (RM) Premium (RM) 5.50 5.50 0.09 6.00 0.30 6.00 0.20 6.50 0.08 6.50 0.80 . Determine options that are in the money, at the money and out of the money. (3 marks) ii. Explain whether the premium of a 60-day option will be priced higher or lower than the premium of both call and put options above. (4 marks)

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