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Refer to Table 2.6 and look at the Microsoft options. Suppose you buy a February expiration call option with exercise price $100. a-1. Suppose the
Refer to Table 2.6 and look at the Microsoft options. Suppose you buy a February expiration call option with exercise price $100. a-1. Suppose the stock price in February is $104.80. Will you exercise your call? Yes O No a-2. What is the profit (loss) on your position? (Enter your answer as a positive value rounded to 2 decimal places.) Loss b-1. If you had bought the February call with exercise price $95, will you exercise your call? Yes O No b-2. What is the profit (loss) on your position? (Enter your answer as a positive value rounded to 2 decimal places.) Profit c-1. If you had bought the February put with exercise price $105, will you exercise your put? Yes c-2. What is the profit (loss) on your position? (Enter your answer as a positive value rounded to 2 decimal places.) Loss Strike Call Put Table 2.6 Prices of stock options on Microsoft January 2, 2019 Expiration 18-Jan-2019 18-Jan-2019 18-Jan-2019 8-Feb-2019 8-Feb-2019 8-Feb-2019 95 100 105 95 100 105 7.65 3.81 1.45 9.50 5.60 3.08 0.98 2.20 4.79 2.86 3.92 6.35 Note: Microsoft stock on this day was $101.51. Source: Compiled from data downloaded from Yahool Finance
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