Question $20(5$ points$)$

Wells Fargo is currently trading at $$46\mathrm{.}50.$ A May call with strike price $$47\mathrm{.}50$ is trading at $$3\mathrm{.}50.$ A May call with strike price $$50$ is trading at $$1\mathrm{.}50.$ An investor buys a May $$47\mathrm{.}50$ call and sells the May $$50$ call. What type of strategy is this?

Question $20$ options:

Bear spread

Bull spread

Calendar spread

Covered call

Question $21(5$ points$)$

In May Wells Fargo closes at $$49$ and the investor closes out their strategy. What is the net payoff to the May $$47\mathrm{.}50$ call? Remember contracts are for $100$ shares.

Question $21$ options:

$-$$$150$

$-$$$350$

$$150$

$-$$$200$

Question $22(5$ points$)$

If Wells Fargo closed at $$49,$ what would the total payoff be on the May $$50$ call $(100$ shares$)?$

Question $22$ options:

$-200$

$-350$

$-150$

$150$

Question $23(5$ points$)$

In the previous strategy, what would be the break$-$even price for the combination strategy?

Question $23$ options:

$$51\mathrm{.}50$

$$51$

$$50$

$$49\mathrm{.}50$