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Suppose the stock of Cameco Corp. currently trades at $ 2 6 per share. The following options on the stock are available:OptionsStrike PricePremiumCall$ 2 7
Suppose the stock of Cameco Corp. currently trades at $ per share. The following options on the stock are available:OptionsStrike PricePremiumCall$Maturity$ monthPut$$ monthA. Given today's stock price, determine the intrinsic value of the call and put.B An investor purchased one contract of the call and sold two contracts of the put.Suppose in one month, the stock price turns out to be $ per share. How much is the total gain or loss for this investor?C Draw a profit diagram for a short position in the put. Label the diagram well. For example, indicate the intersection with the horizontal and vertical axes, show the maximum profit and loss if available.D Put options can be awarded to executives as incentive compensation. True or false? Briefly explain.
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