Question: Please answer the questions and fill out the excel units in red and show the equations used. Call and Put Option Basics Part 1: Calls

Please answer the questions and fill out the excel units in red and show the equations used.

Call and Put Option Basics Part 1: Calls Suppose you buy a call option on Kellogg's stock with X=65, T=18 Dec2015. 1. When you make the purchase, what are you really buying? Buying an option to buy the stock at a price of $65 2. What are you hoping will happen to the price of Kellogg if you were to buy this call? We are hoping the stock will go up higher than the string price of $65 3. Suppose the price of Kellogg's stock at option expiration is $70. What happens to the option? What is your profit on the position? ANSWER 4. Suppose the price of Kellogg's stock at option expiration was instead \$55. What happens to the option? What is your profit on the position? ANSWER rart L: ruts Suppose you put a call option on Intel's stock with X=34,T=160 ct2015. 1. When you make the purchase, what are you really buying? ANSWER 2. What are you hoping will happen to the price of Intel if you were to buy this put? ANSWER 3. Suppose the price of Intel's stock at option expiration is $20. What happens to the option? What is your profit on the position? ANSWER 4. Suppose the price of Intel's stock at option expiration was instead \$38. What happens to the option? What is your profit on the position

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