Suppose that you are writing 5 call contracts on TGT with a strike price of $157.50. The premium is $2.50 per share. Answer the following: (1) Will this option be exercised if the stock price at expiration is $159.25? And more importantly, why (or WHY NOT?) Note: in practicing written communication, your brief answer should be in complete sentences in plain English such that an “average Joe” can follow your line of thought. (2) Calculate your TOTAL profit (loss) if TGT stock price at expiration is $159.25 per share.
Suppose that you are writing 5 call contracts on TGT with a strike price of $157.50. The premium is $2.50 per share. Answer the following: (1) Will this option be exercised if the stock price at expiration is $159.25? And more importantly, why (or WHY NOT?) Note: in practicing written communication, your brief answer should be in complete sentences in plain English such that an “average Joe” can follow your line of thought. (2) Calculate your TOTAL profit (loss) if TGT stock price at expiration is $159.25 per share.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Suppose that you are writing 5 call contracts on TGT with a strike price of $157.50. The premium is $2.50 per share. Answer the following:
(1) Will this option be exercised if the stock price at expiration is $159.25? And more importantly, why (or WHY NOT?) Note: in practicing written communication, your brief answer should be in complete sentences in plain English such that an “average Joe” can follow your line of thought.
(2) Calculate your TOTAL
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