Question
Six-month call options with strike prices of $35 and $40 cost $6 and $4, respectively. An investor creates a bull spread by buying the call
Six-month call options with strike prices of $35 and $40 cost $6 and $4, respectively.
An investor creates a bull spread by buying the call with a strike of $35 and selling (writing) the call with a strike of $40.
What is the maximum gain of the strategy (i.e. maximum profit)?
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Contemporary Financial Management
Authors: Don Cyr, Alfred Kahl, William Rentz, R. Moyer
1st Edition
017616992X, 978-0176169923
