Minimum expected net sale price

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Assume that you purchase the $3.60 March 2018 corn put for $0.10/bu. and that you expect your local corn basis on March 1st to be negative $0.15/bu. and that your broker charges $50 to buy a CBT option and $50 to sell a CBT option. If you buy the $3.60 March 2018 corn put, what is your Minimum Expected Net Sale Price for 5,000 bu. of corn to be delivered on March 1, 2018? Show your calculations.

Reference no: EM131725896

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