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Suppose that you find that YBMs October 100 put has an ask price of $4.10 and a bid price of $4.00. If you want to

Suppose that you find that YBMs October 100 put has an ask price of $4.10 and a bid price of $4.00. If you want to buy these put options to protect your holding of 400 YBM shares from declining, what is your total cost including commission? Assume that the broker charges a commission equal to a flat fee of $15 plus $2 per contract.

a.

$1,623

b.

$1,647

c.

$1,655

d.

$1,663

e.

None of these answers are correct.

ANS: D

how?

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