CH 15. PROBLEM SETS #4 Underlying stock Facebook (FB) price = $75.95 Expiration Strike Call Put Oct-14 75 3.95 3.01 Oct-14 80 1.65 5.72 Nov-14 75 4.85 3.97 Nov-14 80 2.64 6.74 Figure 15.1- Options on Facebook, October 16, 2014 Turn back to Figure 15.1, which lists the prices of various Facebook options. Use the data in the figure to calculate the payoff and the profits for investments in each of the following November 2014 expiration options, assuming that the stock price on the expiration date is $78. a) Call option, X = 75 b) Put option, X = 75 c) Call option, X = 80 d) Put option, X = 80 ANSWER: Cost Payoff Profit Call option, X =75 4.85 3.00 -1.85 Put option, X =75 3.97 0.00 -3.97 Call option, X =80 2.64 0.00 -2.64 Put option, X =80 6.74 2.00 -4.74