1. You buy a stock for $50 per share and simultaneously buy a put with a $50 strike price and a $1.00 premium. If the stock price falls to $45 per share, what is your per-share net profit from this investment position? If you think net profit is negative, enter your answer using a number preceded by a minus sign. If you think net profit is positive, enter your answer as a number.

2. You buy a stock for $50 and simultaneously write a call with a strike price of $51 and a premium of $0.50 per share. If the stock price falls to $48 per share, what is your per-share net profit? If you think net profit is negative, enter your answer using a number preceded by a minus sign. If you think net profit is positive, enter your answer as a number.

Answer rating: 100% (QA)

For Q1 Cost of Stock 50 Put Strike Price 50 Put Premium 100 credited to you Current Market Price 45 ... View the full answer