Reference no: EM131524880

Use the option quote information shown here to answer the questions that follow. The stock is currently selling for $46.   

Call put option expiration strike price volume Last Volume Last

Macrosoft Feb 47 104 2.13 59 3.13

Mar 47 80 2.37 41 3.54

May 47 41 2.65 30 3.96

Aug 47 22 2.86 22 4.00

a. Suppose you buy 29 contracts of the February 47 call option. How much will you pay, ignoring commissions?

Suppose you buy 29 contracts of the February 47 call option. Macrosoft stock is selling for $49 per share on the expiration date.

b-1 How much is your options investment worth?      Payoff $   

b-2 What if the terminal stock price is $48?      Payoff $

Suppose you buy 29 contracts of the August 47 put option.   

c-1 What is your maximum gain?      Maximum gain $    

c-2 On the expiration date, Macrosoft is selling for $42 per share. How much is your options investment worth?      Position value $

c-3 On the expiration date, Macrosoft is selling for $42 per share. What is your net gain? Net gain $    

Suppose you sell 29 of the August 47 put contracts.

d-1 What is your net gain or loss if Macrosoft is selling for $42 at expiration? (Enter your answer as a positive value.)       $

d-2 What is your net gain or loss if Macrosoft is selling For $50 at expiration? (Enter your answer as a positive value.)       $   

d-3 What is the break-even stock price? (Round your answer to 2 decimal places, (e.g., 32.16).)      Break-even $