Question: On August 1 , 2 0 2 3 , Swifty Ltd . purchased a call option from Starco Corporation. The option gave Swifty the right

On August 1,2023, Swifty Ltd. purchased a call option from Starco Corporation. The option gave Swifty the right to buy 8,400 shares in a third company, Dillon Ltd., at a price of $10 per share. On the day Swifty purchased the option, Dillon shares were trading at $10 each. Swifty paid $1,300 for the options. On August 31,2023, the Dillon shares were trading at $12 each, and the options for Dillon shares were trading at $25,100. On September 15, Swifty settled the options in cash when the Dillon shares were trading at $15 and the options were trading at $42,000.

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