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Call option on the firm to expire

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Reference no: EM132578077

Manchesterd United Movers has a $10,000 debt due in six months. If the value of the firm's assets six months from now is $8,500, the shareholders will in essence:

Will allow their call option on the firm to expire.

Write a' call on the firm by paying the debt.

Exercise their call option on the firm.

Buy a put on the firm by paying the debt.

Will allow their put option on the firm to expire.

Pls explain why?

Reference no: EM132578077

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