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Suppose that a European CALL option to buy a share for $68 costs $17 and is...

Suppose that a European CALL option to buy a share for $68 costs $17 and is held until maturity. Which of the following stock price will always create a profit for the seller of this CALL option?

stock prices higher than $90

none of the above

stock prices higher than $70

stock prices lower than $95

stock prices lower than $85
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Answer #1

For a seller of the call option the profit will be generated only when the market price of option is less than strike price plus cost of call option.Hence Stock Price < Strike Price+Call Option
Stock Price should be less than <68+17
Stock Price<85

Hence option e is correct option

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