Please answer the next question based on the following quotes on currency options contracts for Swiss francs (CHF), where each contract has 62,500 CHFs. Exercise prices, call and put premiums are in cents. Calls Vol. Last MC-European 2.78 Puts Vol. L Styl C 31 14 3.60 2.68 000 ៖ NAN 1:21 13 3.1 If you buy one December CALL options contract with an exercise price of $0.79. If at the time of the option expiration date, the spot price for Swiss francs is $0.805, then this call option is and you incur a net O out-of-the-money; loss of $1,275.00 O out-of-the-money; loss of $937.50 O in-the-money; loss of $337.50 O in-the-money; profit of $937.50
Please answer the next question based on the following quotes on currency options contracts for Swiss francs (CHF), where each contract has 62,500 CHFs. Exercise prices, call and put premiums are in cents. Calls Vol. Last MC-European 2.78 Puts Vol. L Styl C 31 14 3.60 2.68 000 ៖ NAN 1:21 13 3.1 If you buy one December CALL options contract with an exercise price of $0.79. If at the time of the option expiration date, the spot price for Swiss francs is $0.805, then this call option is and you incur a net O out-of-the-money; loss of $1,275.00 O out-of-the-money; loss of $937.50 O in-the-money; loss of $337.50 O in-the-money; profit of $937.50
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:Please answer the next question based on the following quotes on currency options contracts for Swiss francs (CHF), where each
contract has 62,500 CHFs. Exercise prices, call and put premiums are in cents.
Calls
Vol. Last
MC-European
2.78
Puts
Vol. L
Styl
C
31
14
3.60
2.68
000
៖
NAN
1:21
13
3.1
If you buy one December CALL options contract with an exercise price of $0.79. If at the time of the option expiration date, the
spot price for Swiss francs is $0.805, then this call option is
and you incur a net
O out-of-the-money; loss of $1,275.00
O out-of-the-money; loss of $937.50
O in-the-money; loss of $337.50
O in-the-money; profit of $937.50
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