Put Option will be exercised if the expiration Price is less than the exercise Price.
Profit = Exercise Price-Expiration Price-Premium Paid
Profit= $10.00-$8.50-$1.00
Profit = $0.50
Answer A
You buy a put option on a stock for a premium of $1. The exercise price...
You write a put option on a stock for a premium of $1. The exercise price is $6.50. What is the option's profit or loss if just prior to expiration the stock price is $4.50? a. $0.00 b. ($0.50) c. $0.50 d. $1.00 e. ($1.00)
You write a put on Kane with an exercise price of $3.50 and a premium of $1.25. At the same time you buy a call on Kane with an exercise price also at $3.50 and a premium of $1.25. Calculate the profit or loss on both positions simultaneously if just prior to option expiration Kane's stock price is $3.00. a. ($0.50) b. ($1.25) c. $0.0 O d. ($1.75) e. ($0.75)
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questions 25-28 please 25. You buy a call option on Boeing Corp with an exercise price of $40 and an expiration date in September, and you write a call option on Boeing Corp with an exercise price of $40 and an expiration date in October. This strategy is called a A. Time spread B. Long straddle C. Short straddle D. Money spread E. None of the above 26. The maximum loss a buyer of a stock's call option can suffer...
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