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Explain the effect of this value being zero or negative

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a) Explain in wordsb) Explain in words responsibility seller and of the holder what a deriviative financial product is. The process of creating an option. What is the of the of an option.

c) Explain in words what a call option is and when it would be in the money and when it would be out of the money. Use the stock price and exercise price in your explanation.

d) Explain what a put option is and when it would be in the money and when it would be out of the money. Use the stock price and exercise price in your explanation.

e) On December 30, the price of Kotter 's shares is $39.75 and the Kotter JAN call option with a strike price of $36.00 is trading at $4.00. What is the intrinsic value of this option? Explain the effect of this value being zero or negative.

f) On December 30, the price of Kotter's shares is $39.75 and the Kotter JAN 42 put option is trading at $2.55. What is the intrinsic value of this option. Explain the effect of this value being zero or negative.

Reference no: EM132607909

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