Problem 2-20

Both a call and a put currently are traded on stock XYZ; both have strike prices of $60 and expirations of 6 months.

a.	What will be the profit to an investor who buys the call for $4.8 in the following scenarios for stock prices in 6 months? (a) $40; (b) $45; (c) $50; (d) $55; (e) $60. (Negative amounts should be indicated by a minus sign. Round your answers to 1 decimal place. Omit the "$" sign in your response.)

	Stock Price				Profit
a.		$	40		$
b.		$	45		$
c.		$	50		$
d.		$	55		$
e.		$	60		$

b.	What will be the profit to an investor who buys the put for $5 in the following scenarios for stock prices in 6 months? (a) $40; (b) $45; (c) $50; (d) $55; (e) $60. (Negative amounts should be indicated by a minus sign. Round your answers to 1 decimal place. Omit the "$" sign in your response.)

	Stock Price				Profit
a.		$	40		$
b.		$	45		$
c.		$	50		$
d.		$	55		$
e.		$	60		$