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You would like to speculate on a rise in the price of a certain stock. The current stock price is $80, and a six-month call
You would like to speculate on a rise in the price of a certain stock. The current stock price is $80, and a six-month call with a strike of $83 costs $5.0. You have $10,000 to invest.
Identify two alternative strategies, one involving an investment in the stock and the other involving investment in the option.
Compare the profitability of the two alternatives if the stock price rises to $90.
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