The expected value of a discrete random variable

A) is the outcome that is most likely to occur.

B) can be found by determining the 50% value in the c.d.f.

C) equals the population median.

D) is computed as a weighted average of the possible outcomes of that random variable, where the weights are the probabilities of that outcome.

You purchase one IBM July 125 call contract for a premium of $7. You hold the option until the expiration date, when IBM stock sells for $127 per share. You will realize a ______ on the investment. (assume the option contract is for 100 shares).

You sell one IBM July 120 call contract for a premium of $2. At the expiration date, IBM stock sells for $121 per share. You will realize a ______ on the investment. (assume the option contract is for 100 shares).

You sell one IBM July 120 put contract for a premium of $3. At the expiration date, IBM stock sells for $123 per share. You will realize a ______ on the investment. (assume the option contract is for 100 shares).

You purchase one IBM July 120 put contract for a premium of $3. You hold the option until the expiration date, when IBM stock sells for $123 per share. You will realize a ______ on the investment. (assume the option contract is for 100 shares).