Question

Tom Gettback buys 100 shares of Jobnson Walker stock for $87.00. per share and a 3-mont Johnson Walker put option with an exercise price of $105.00 for $20.00 What is Tom's dollr gainloss if at expiration the stock is selling for $105.00 per share?
a. $1000 gain
b. $200 loss
c. $1000 loss
d. $200 gain
c. None of the above

Answer 1

Answer:

b. $200 loss is the correct option

Explanation:

=100*(105-87)+(MAX(105-105,0)-20)*100

=-200