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The current price of one share of GBP stock is 50.00. Matt purchases (long) a call option on GBP stock with a strike price of
The current price of one share of GBP stock is 50.00. Matt purchases (long) a call option on GBP stock with a strike price of 53.00 and one-year to maturity. The price of the option is 4.95. The continuously compounded risk free rate is 4%. What is Matts profit at the end of one year if the stock price at that time is 40.00 per share? Write your answer in two decimal places.
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