Today, You Are Buying a One-Year Call on Piper Sons

question 63

Multiple Choice

Today, you are buying a one-year call on Piper Sons stock with a strike price of $27.50 per share and a one-year risk-free asset which pays 3.5 percent interest. The cost of the call is $1.40 per share and the amount invested in the risk-free asset is $26.57. How much total profit will you earn on these purchases if the stock has a market price of $29 one year from now?

• A)$0.10
• B)$0.85
• C)$1.03
• D)$1.11
• E)$1.17

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Refers to the physiological and genetic characteristics of an organism that influence behavior and development.

Pleasure

A feeling of happiness, enjoyment, or satisfaction derived from experiencing something enjoyable or satisfying.

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The climax of sexual excitement, characterized by intense pleasure and followed by relaxation of the body.

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The feeling of sexual interest towards another person.