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Beth (a hedger; she owns the stock) has previously purchased stock in a company at $53 per share. Call options at a $50 exercise price presently have a $4 premium per share. Beth sells/writes a call option to Joe (he buys the option from Beth) on the stock that she owns. If the call option is exercised by Joe when the price of the stock is $58, what is the net gain or loss per share to Beth?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92724837

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