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The price of a four-month greaterthanorequalto call option with an exercise price of $35 is $6. The current price of greaterthanorequalto stock is $40 per
The price of a four-month greaterthanorequalto call option with an exercise price of $35 is $6. The current price of greaterthanorequalto stock is $40 per share. The call holder exercises the call at expiration when the price of greaterthanorequalto stock is $43. What is the payoff to the call holder?(Each contract is for 100 shares of stock) $200 $300 $500 $800 Suppose that an investor believes the price of CNA stock, which is currently $50 per share, will increase substantially in the next six months. Six-month CNA call options with an exercise price of $50 are selling at a premium of $5. The investor has $5,000 to invest. Which one of the following strategies would be most profitable if the investor's expectations are accurate? Invest $5,000 in CNA stock Invest $5,000 in CNA stock and write covered calls Invest $5,000 in six-month CNA calls Invest $2, 500 in CNA stock and $2, 500 in six-month CNA calls A three-month HP put option with an exercise price of $60 sells for a premium of $8. The put is in the money only if the price of HP stock is greater than $68 per share greater than $60 per share less than $60 per share less than $52 per share The price of a two-month AT&T put option with an exercise price of $45 is $7. The current price of AT&T stock is $40 per share. The put holder exercises the put at expiration when the price of AT&T stock is $35. What is the profit per share to the put holder? $2 $3 $10 $12 You just purchased a three-month BP call option (exercise price $75) and a three-month BP put option (exercise price $75). The call premium is $6 and the put premium is $2. Your maximum potential loss from this position is (Assume each contract is for 100 shares of stock) $200 $600 $800 unlimited
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