A speculator can choose between buying 543 shares of a stock for $40 per share and buying 1,557 European call options on the stock with a strike price of $45 for $4 per option. For second alternative to give a better outcome at the option maturity, what is the stock price?

Answer rating: 100% (QA)

To compare the two alternatives we need to calculate the total cost of each and determine which one ... View the full answer