2-day call option with a strike price of $1600/share for a price of $13.00/share. Assume a 3.5%...

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2-day call option with a strike price of $1600/share for a price of $13.00/share. Assume a 3.5% interest rate per annum.

a) Draw a payoff and profit diagram of this position. Indicate your breakeven point.

b) To your horror, over the next two days CMG jumps to $1675/share. What is your total profit or loss?

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Introduction to Corporate Finance What Companies Do

ISBN: 978-1111222284

3rd edition

Authors: John Graham, Scott Smart

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Posted Date: Oct 07, 2023 02:31 AM

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2-day call option with a strike price of $1600/share for a price of $13.00/share. Assume a 3.5%...

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Introduction to Corporate Finance What Companies Do

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