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You have just purchased the options listed below. Based on the information given, indicate whether the option is in the money, out of the money, or at the money, whether you would exercise the option if it were expiring today, what the dollar profit would be, and what the percentage return would be. (Enter “0” if there is no profit or return from not exercising the option. Round your answer to 2 decimal places.) Company Option Strike Today's Stock Price In/Out of the Money? Premium Exercise? Profit Return ABC Call 10 $10.26 0.94 % ABC Put 10 $10.26 0.79 % ABC Call 25 $23.93 0.89 % ABC Put 25 $23.93 2.09 % b. Now suppose that time has passed and the stocks’ prices have changed as indicated in the table below. Recalculate your answers to part a. Company Option Strike Today's Stock Price In/Out of the Money? Premium Exercise? Profit Return ABC Call 10 $11.23 0.94 % ABC Put 10 $11.23 0.79 % ABC Call 25 $27.00 0.89 % ABC Put 25 $27.00 2.09 %

Financial Management, Finance

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