Question

The following price quotations are for exchange-listed options on Primo Corporation common stock.

Company Strike Expiration Call Put
Primo 61.12 56 Feb 7.29 0.49
With transaction costs ignored, how much would a buyer have to pay for one call option contract. Assume each contract is for 100 shares.

Amount for one call option $

Answer 1

$729

Step-by-step explanation:

The computation of the one call option is shown below:

= Call option price × number of shares

= $7.29 × 100 shares

= $729

Simply we multiplied with the call option price with the number of shares so that the one call option could be calculated as we have to find out the one call option price

All other information which is given is not relevant. Hence, ignored it