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The price of a stock is $ 4 5 , and a six - month call with a strike price of $ 4 0 sells
The price of a stock is $ and a sixmonth call with a strike price of $ sells for $ Round your answers to the nearest dollar.
a What is the option's intrinsic value?
$
b What is the option's time premium?
$
c If the price of the stock rises, what happens to the price of the call?
As the price of the stock rises, the value of the call
d If the price of the stock falls to $ what is the maximum you could lose from buying the call? Enter your answer as a positive value.
$
e What is the maximum profit you could earn by selling the call uncovered naked
$
f If at the expiration of the call, the price of the stock is $ what is the profit or loss from buying the call? Enter your answer as a positive value.
The
from buying the call is $
g If at the expiration of the call, the price of the stock is $ what is the profit or loss from selling the call naked? Enter your answer as a positive value.
The
from selling the call naked is $
h If at the expiration of the call, the price of the stock is $ what is the profit or loss from buying the call? Enter your answer as a positive value.
The
from buying the call is $
i If at the expiration of the call, the price of the stock is $ what is the profit or loss from selling the call naked? Enter your answer as a positive value.
The
from selling the call naked is $
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