Tom Hank buys 150 shares of J.W stock for $85 per share and a three-month J.W call option with an exercise price of $105 for $15. What is his dollar gain if the stock is selling for $80 per share at expiration?   a) $500 gain   b) $750 loss   c) $3000 loss   d) $2250 loss   e) $6750 gain

EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter6: Fixed-income Securities: Characteristics And Valuation
Section: Chapter Questions
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Tom Hank buys 150 shares of J.W stock for $85 per share and a three-month J.W call option with an exercise price of $105 for $15. What is his dollar gain if the stock is selling for $80 per share at expiration?

 

a) $500 gain

 

b) $750 loss

 

c) $3000 loss

 

d) $2250 loss

 

e) $6750 gain

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