Multiple Choice
Today, you are buying a one-year call on SLO stock with a strike price of $50 along with a one-year risk-free asset that pays 4 percent interest. The cost of the call is $3.20 and the amount invested in the risk-free asset is $48.08. What is the most you can lose over the next year?
A) -$3.33
B) -$3.20
C) -$3.08
D) -$1.28
E) -$0.72
Correct Answer:
Verified
Correct Answer:
Verified
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