Look back at Table 23.2. Suppose that by January 2019, the price of Amazon could either rise from its January 2018 level to $1,300 ? 1.22 = $1,586 or fall to $1,300/1.22 = $1,066.

a. What would be your percentage return on a January expiration call option with an exercise price of $1,300 if the stock price rose?

b. What would be your percentage return if the stock price fell?

c. Which is riskier: the stock or the option?

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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