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Suppose a financial manager buys call options on 50,000 barrels of oil with an exercise price of $94 per barrel. She simultaneously sells a put
Suppose a financial manager buys call options on 50,000 barrels of oil with an exercise price of $94 per barrel. She simultaneously sells a put option on 50,000 barrels of oil with the same exercise price of $94 per barrel. Consider her gains and losses if oil prices are $88, $92, $94, $96, and $100. (Do not round intermediate calculations. Leave no cells blank - be certain to enter "0" wherever required. A negative answer should be indicated by a minus sign.) |
Market price | $88 | $92 | $94 | $96 | $100 |
Payoffs per barrel | $ | $ | $ | $ | $ |
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