a) Will call buyer exercise the call when market price on July 19 is $90? Please answer yes or no.

b) Will call buyer exercise the call when market price on July 19 is $130? YES or NO.

c) how much is profit/loss for call writer( who writes a call) if the market price on July 19 is $100?

 

d) How much is the profit/loss for a call writer when market price on July 19 is $140?
 

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Suppose you write a IBM call which was sold for $7.00 on Apr 9 2013 with exercise price X-$110, on Expiration date July 19,2013, given different possibilities of market prices, please answer. Hint: Profit/ loss is not payoff. Will call buyer exercise ST: Market Dollar price of IBM profit/loss to call the call? 19 July 2013 (yes or no) writer 80 90 100 110 120 130 140 150 160 170 180 190 Suppose you write a IBM call which was sold for $7.00 on Apr 9 2013 with exercise price X-$110, on Expiration date July 19,2013, given different possibilities of market prices, please answer. Hint: Profit/ loss is not payoff. Will call buyer exercise ST: Market Dollar price of IBM profit/loss to call the call? 19 July 2013 (yes or no) writer 80 90 100 110 120 130 140 150 160 170 180 190

Answer rating: 100% (QA)

a When the market rate is 90 the put buyer will exercise the right to sell the IBM shares at str... View the full answer