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Calculate the break-even amount

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Reference no: EM133068137

Anna bought an option contract on Telstra shares with an exercise price of $60 and an expiry date in one month. The market price for Telstra shares today is $57.21. The call price is trading at $0.25.

-Calculate the break-even amount for the call position and draw a fully labelled diagram for both buyer of the option and seller of the option.

-At what minimum share price will the option buyer exercise the option on the expiration date? Provide reasoning in your answer.

Reference no: EM133068137

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