Problem

Use data from finance.yahoo.com to answer the following questions. In the Get Quotes box...

Use data from finance.yahoo.com to answer the following questions. In the Get Quotes box, enter stock symbol “GE” for General Electric. Go to the S&P Stock Reports section for GE.

a. Locate the 52-week range for GE.

b. At what price did GE last trade?

c. Click on the link to Options on the left side of the Yahoo! Finance screen. Choose an expiration date three months in the future, and then choose one of the call options listed by selecting an exercise (strike) price. What is the last price (premium) shown for the call option?

d. Is the call option in the money?

e. Draw a graph that shows the payoff and the profit to the holder of this call option over a range of prices, including the prices you found in the 52-week range of the S&P Stock Report.

f. Repeat the steps for a put option on GE with the same expiration date and the same strike price.

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