Question
Use the option quote information shown here to answer the questions that follow. The stock is currently selling for $46. Calls Puts Strike Option Expiration
Use the option quote information shown here to answer the questions that follow. The stock is currently selling for $46. |
Calls | Puts | |||||||||||||||||
Strike | ||||||||||||||||||
Option | Expiration | Price | Vol. | Last | Vol. | Last | ||||||||||||
Macrosoft | Feb | 47 | 104 | 2.13 | 59 | 3.13 | ||||||||||||
Mar | 47 | 80 | 2.37 | 41 | 3.54 | |||||||||||||
May | 47 | 41 | 2.65 | 30 | 3.96 | |||||||||||||
Aug | 47 | 22 | 2.86 | 22 | 4.00 | |||||||||||||
a. | Suppose you buy 29 contracts of the February 47 call option. How much will you pay, ignoring commissions? |
Cost | $ |
Suppose you buy 29 contracts of the February 47 call option. Macrosoft stock is selling for $49 per share on the expiration date. |
b-1 | How much is your options investment worth? |
Payoff | $ |
b-2 | What if the terminal stock price is $48? |
Payoff | $ |
Suppose you buy 29 contracts of the August 47 put option. |
c-1 | What is your maximum gain? |
Maximum gain | $ |
c-2 | On the expiration date, Macrosoft is selling for $42 per share. How much is your options investment worth? |
Position value | $ |
c-3 | On the expiration date, Macrosoft is selling for $42 per share. What is your net gain? |
Net gain | $ |
Suppose you sell 29 of the August 47 put contracts. |
d-1 | What is your net gain or loss if Macrosoft is selling for $42 at expiration? (Enter your answer as a positive value.) |
(Click to select)GainLoss | $ |
d-2 | What is your net gain or loss if Macrosoft is selling For $50 at expiration? (Enter your answer as a positive value.) |
(Click to select)GainLoss | $ |
d-3 | What is the break-even stock price? (Round your answer to 2 decimal places, (e.g., 32.16).) |
Break-even | $ |
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