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[Related to the Making the Connection] Use the following information on call and put options for Facebook to answer the questions below. Facebook Call Volume
[Related to the Making the Connection] Use the following information on call and put options for Facebook to answer the questions below. Facebook Call Volume 21 44 Expiration Oct Nov Jan Apr Oct Nov Jan Apr Strike 17.00 17.00 17.00 17.00 18.00 18.00 18.00 18.00 Last 5.00 5.20 5.50 5.70 4.00 4.44 4.50 5.22 Open Interest 3.064 795 691 1,409 4,762 4,047 943 712 1 2 49 37 10 31 Underlying stock price: 21.95 Put Open Volume Interest 13 14.427 485 13,098 231 7.381 69 7.289 154 22,337 4426 16,197 409 13,754 60 6,659 Last 0.02 0.40 0.55 1.15 0.07 0.50 0.80 1.45 The intrinsic value of the call option that expires in April and has a $17 strike price is $ 4.95 . (Round your response to two decimal places.) The intrinsic value of the put option that expires in January and has a $18 strike price is $ 0. (Round your response to two decimal places.) Why would a call with a $18 strike price sell for less than a call with a $17 strike price for all expiration dates) while a put with a $18 strike price would sell for more than a put with a $17 strike price for all expiration dates)? (Check all that apply.) A. The $18 put is more expensive than the $17 put because the stock price will reach $17 before it hits $18, making the option less valuable at $95 than $105. B. The $18 call is cheaper than the $17 call because the stock price will reach $17 before it hits $18, making the option more valuable at $17 than $18. IC. The $18 put is more expensive than the $17 put because the stock price will reach $17 before it hits $18, making the option more valuable at $17 than $18. D. The $18 call is cheaper than the $17 call because the stock price will reach $17 before it hits $18, making the option less valuable at $17 than $18. Suppose you buy the October call with a strike price of $17. If you exercise it when the price of Facebook is $28, what will be your profit or loss? Your profit is $ 6.00. (Round your response to two decimal places.) Suppose you buy the April put with a strike price of $17 and the price of Facebook stock remains at $21.95. What will be your profit or loss? Your IS per share. (Round your response to two decimal places.) ?? Choose One. profit loss
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