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What is the most the buyer of the call can lose

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Reference no: EM131177419

Given the following information, price of a stock $103 strike price of a six-month call $102 market price of the call $6 strike price of a six-month put $102 market price of the put $5 answer the following sentences.

b. What is the time premium paid for the put? Round your answer to the nearest dollar. $

c. If an investor establishes a naked call position, what amount is received? Round your answer to the nearest dollar. $

d. What is the most the buyer of the call can lose? Round your answer to the nearest dollar. $

At the expiration of the options (i.e., after six months have elapsed), the price of the stock is $95.

f. What is the profit (loss) from buying the stock? Round your answer to the nearest dollar. $_____?

g. What is the profit (loss) from buying the call? Round your answer to the nearest dollar. $______?

h. What is the profit (loss) from writing the call covered? Round your answer to the nearest dollar is $___?

i. What is the profit (loss) from selling the put? Round your answer to the nearest dollar. $___?

j. At expiration, what time premium is paid for the call? Round your answer to the nearest dollar. $___?

Reference no: EM131177419

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