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What will be the profit to an investor who buys the call

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Reference no: EM132950119

Question - Both a call and a put currently are traded on stock XYZ; both have strike prices of $55 and expirations of 6 months.

a. What will be the profit to an investor who buys the call for $4.5 in the following scenarios for stock prices in 6 months? (i) $40; (ii) $45; (iii) $50; (iv) $55; (v) $60.

b. What will be the profit to an investor who buys the put for $5 in the following scenarios for stock prices in 6 months? (i) $40; (ii) $45; (iii) $50; (iv) $55; (v) $60.

Reference no: EM132950119

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