a. Turn back again to Table 23.2, which lists prices of various Amazon options. Use the data in the table to calculate the payoff and the profits for investments in each of the following January 2019 maturity options, assuming that the stock price on the expiration date is $1,350.

i. Call option with exercise price of $1,200

ii. Put option with exercise price of $1,200iii. Call option with exercise price of $1,300

iv. Put option with exercise price of $1,300

v. Call option with exercise price of $1,400

vi. Put option with exercise price of $1,400

b. Now repeat part (a), assuming that the stock price on the expiration date is $1,150.

c. Are the prices of the January 2019 options more or less than those of the corresponding July 2018 options that you looked at in Problem 2?

Transcribed Image Text:

Explration Date Exercise Price Call Price Put Price $ 31.10 $1,200 $132.70 April 2018 70.10 1,300 73.20 1,400 33.00 134.20 July 2018 1,200 161.70 53.55 1,300 104.00 96.00 1,400 156.05 62.55 January 2019 88.05 1,200 210.00 155.35 1,300 133.25 1,400 112.00 190.00