The Premium on a Euro Call Option Is

question 138

Multiple Choice

The premium on a euro call option is $.02. The exercise price is $1.32. The break-even point is ____ for the buyer of the call, and ____ for the seller of the call. (Assume zero transactions costs and that the buyer and seller of the put option are speculators.)

• A) $1.30; $1.30
• B) $1.34; $1.30
• C) $1.30; $1.34
• D) $1.34; $1.34

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