Rachel is considering an investment in Yonan Communications, whose stock currently sells for $60. A put option on Yonan's stock, with an exercise price of $55, has a market value of $3.11. Meanwhile, a call option on the stock with the same exercise price and time until expiration has a market value of $9.35. The market believes that at the expiration of the options, the stock price will be $50 or $70 with equal probability.

What is the premium associated with the put option? The call option? Round your answers to the nearest cent.

The premium associated with the put option: $

The premium associated with the call option: $

If Yonan's stock price increases to $70, what would be the return to an investor who bought a share of the stock? If the investor bought a call option on the stock? If the investor bought a put option on the stock? Round your answers to two decimal places.

Investment	Returns
Own stock	%
Buy call option	%
Buy put option	%

If Yonan's stock price decreases to $50, what would be the return to an investor who bought a share of the stock? If the investor bought a call option on the stock? If the investor bought a put option on the stock? Round your answers to two decimal places.

Investment	Returns
Own stock	%
Buy call option	%
Buy put option	%

If Rachel buys 0.5 share of Yonan Communications and sells one call option on the stock, has she created a riskless hedged investment? What is the total value of her portfolio under each scenario? Round your answers to the nearest cent.

Rachels investment strategy would yield a payoff of $ , if the ending stock price is $50.00. Her investment strategy has a payoff of $ , if the ending stock price is $70.00. The strategies -Select-do not have identicalhave identicalItem 11 payoffs; therefore, this -Select-is notisItem 12 a riskless hedged portfolio.

If Rachel buys 0.8 share of Yonan Communications and sells one call option on the stock, has she created a riskless hedged investment? What is the total value of her portfolio under each scenario? Round your answers to the nearest cent.

Rachels investment strategy would yield a payoff of $ , if the ending stock price is $50.00. Her investment strategy has a payoff of $ , if the ending stock price is $70.00. The strategies -Select-do not have identicalhave identicalItem 15 payoffs; therefore, this -Select-is notisItem 16 a riskless hedged portfolio.

PLEASE HELP ASAP. DUE TONIGHT!!!!!!!!!