Question
You have purchased a put option on Pfizer common stock. The option has an exercise price of $57 and Pfizers stock currently trades at $59.
You have purchased a put option on Pfizer common stock. The option has an exercise price of $57 and Pfizers stock currently trades at $59. The option premium is $0.60 per contract. a. What is your net profit on the option if Pfizers stock price does not change over the life of the option? (Negative amount should be indicated by a minus sign. Round your answer to 2 decimal places. (e.g., 32.16)) Net profit $ per share b. What is your net profit on the option if Pfizers stock price falls to $53 and you exercise the option? (Negative amount should be indicated by a minus sign. Round your answer to 2 decimal places. (e.g., 32.16)) Net profit $ per share
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