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Refer to the stock options on Microsoft in the Figure 2.10. Suppose you buy a September expiration call option on 100 shares with the exercise
Refer to the stock options on Microsoft in the Figure 2.10. Suppose you buy a September expiration call option on 100 shares with the exercise price of $135. a-1. If the stock price in September is $139, will you exercise your call? O Yes a-2. What is the net profit/loss on your position? (Input the amount as a positive value.) Net loss of $ 112 a-3. What is the rate of return on your position? (Negative value should be indicated by a minus sign. Round your answer to 2 decimal places.) Rate of return % b-1. Would you exercise the call if you had bought the September call with the exercise price $130? Yes b-2. What is the net profit/loss on your position? (Input the amount as a positive value.) of b-3. What is the rate of return on your position? (Negative value should be indicated by a minus sign. Round your answer to 2 decimal places.) Rate of return % C-1. What if you had bought an September put with exercise price $135 instead? Would you exercise the put at a stock price of $135? Yes c-2. What is the rate of return on your position? (Negative value should be indicated by a minus sign.) Rate of return %
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