Question: a. You have just purchased the options listed below. Based on the information given, indicate whether the option is in the money, out of the

 a. You have just purchased the options listed below. Based onthe information given, indicate whether the option is in the money, out

a. You have just purchased the options listed below. Based on the information given, indicate whether the option is in the money, out of the money, or at the money, whether you would exercise the option if it were expiring today, what the dollar profit would be, and what the percentage return would be. (Enter "0" if there is no profit or return from not exercising the option. Negative amounts should be indicated by a minus sign. Round your answer to 2 decimal places.) TTTEE Today's Stock Price In/Out of the Option Company Strike Premium Exercise? Profit Return Money? 10 $ Call 10.26 1.06 $ Put 10 10.26 0.91 $ 23.93 Call 25 1.01 Put 25 23.93 2.21 b. Now suppose that time has passed and the stocks' prices have changed as indicated in the table below. Recalculate your answers to part a Today's Stock Price In/Out of the Premium Exercise? Profit Company Option Strike Return Money? $ 1.06 Call 10.00 11.23 $ 11.23 Put 10.00 0.91 Call $ 25.00 27.00 1.01 25.00 2.21 Put 27.00

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!