Suppose another investor purchases one April put option contract with a strike price of $17.50 at the total cost of $50. The investor would obtain the right sell 100 Intel shares for $17.50 per share prior to April 21, 2021. Assume that the price of an Intel share is $30 on April 21, 2021. What is the payoff of the put option at maturity? -$625 $12.50 -$12.50 $50 $32.50 -$32.50 $625 $0 -$50
Suppose another investor purchases one April put option contract with a strike price of $17.50 at the total cost of $50. The investor would obtain the right sell 100 Intel shares for $17.50 per share prior to April 21, 2021. Assume that the price of an Intel share is $30 on April 21, 2021. What is the payoff of the put option at maturity? -$625 $12.50 -$12.50 $50 $32.50 -$32.50 $625 $0 -$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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Question 3
Suppose another investor purchases one April put option contract with a strike price
of $17.50 at the total cost of $50. The investor would obtain the right sell 100 Intel
shares for $17.50 per share prior to April 21, 2021. Assume that the price of an Intel
share is $30 on April 21, 2021. What is the payoff of the put option at maturity?
O -$625
O $12.50
-$12.50
$50
O $32.50
O -$32.50
O $625
O $0
-$50
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