Consider the September 2012 IBM call and put options in Problem 20-3. Ignoring any interest you might earn over the remaining few days? life of the options, consider the following.;a. Compute the break-even IBM stock price for each option (i.e., the stock price at which your total profit from buying and then exercising the option would be 0).;b. Which call option is most likely to have a return of?100%?;c. If IBM?s stock price is $216 on the expiration day, which option will have the highest return?
Paper#25159 | Written in 18-Jul-2015Price : $22