ABC, Which Closed at $151, Has Call Options Trading in April

question 3

Essay

ABC, which closed at $151, has call options trading in April, July, and October with the following values:
$$
$\begin{array}{llllc}&&&----\text { Calls }-----\\{\text { Options/Strike }} & \text { April } & \text { July } & \text { October } \\\text { ABC }\quad140 & 111 / 4 & 11^{3 / 4} & 13 \\151 \quad 150 & 11 / 2 & 3 & 4 \\151\quad 160 & 3 / 4 & 11 / 2 & 2 \end{array}$


(a) Calculate the intrinsic value of the April 150 call.
(b) Calculate the intrinsic value of the April 140 call.
(c) Should the price of ABC rise to $156, what is the minimum value that the April 150 call should trade at?

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