Question: Suppose Tim expects interest rates to decrease and purchases a call option on Treasury note futures from Alyssa. The exercise price on Treasury note futures
Suppose Tim expects interest rates to decrease and purchases a call option on Treasury note futures from Alyssa. The exercise price on Treasury note futures is 88-00. The call option is purchased at a premlum of 2-00. Assume that interest rates do decline and, as a result, the price of the Treasury note futures contract increases over time to a value of 9900 shortly before the option's explration date. If Tim decides to exercise the option, his profit will be The profit that Alyssa will make will be
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