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(3 pts) Consider a June 2020 Put option contract on CC Co. with an exercise price...

  1. (3 pts) Consider a June 2020 Put option contract on CC Co. with an exercise price of $40 and a premium of $3.30.
    1. If on the third Friday of June the price of CC is as follows, fill in the chart below as is relates to the buyer of the contract.

Price in June                   Value of Option Contract              Profit/Loss for Buyer

$30                               ______________                         _______________

$39                               ______________                         _______________

$48                               ______________                         _______________

  1. (3 pts) Consider a June 2020 Put option contract on DD Co. with an exercise price of $50 and a premium of $4.70.
    1. If on the third Friday of June the price of DD is as follows, fill in the chart below as is relates to the writer of the contract.

Price in June                   Value of Option Contract              Profit/Loss for writer

$41                               ______________                         _______________

$47                               ______________                         _______________

$56                               ______________                         _______________

Solutions

Expert Solution

Please refer to below spreadsheet for calculation and answer. Cell reference also provided.

Cell reference -

jeff jeffy answered 2 years ago
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