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Suppose you believe that Apple's stock price is going to increase from its current level of $ 68.68 sometime during the next 5 months. For
Suppose you believe that Apple's stock price is going to increase from its current level of $ 68.68 sometime during the next 5 months. For $ 376.37 you could buy a 5-month call option giving you the right to buy 100 shares at a price of $ 76 per share. If you bought a 100-share contract for $ 367.37 and Apple's stock price actually changed to $ 86.65 at the end of 5 months, and after behaving economically rationally on your decision to exercise the option, what would be your net profit (or loss) ?
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