Question: Exhibit 16.7 USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM Consider the following information on put and call options for a common stock. Strike Price

Exhibit 16.7 USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM Consider the following information on put and call options for a common stock.

Strike Price Put Price Call Price
$22.50 $2.65 $1.85

Refer to Exhibit 16.7. Calculate the net value of a covered call position at an expiration stock price of $20.

a. $4.45
b. $18.15
c. $1.85
d. $21.85
e. $24.35

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