The current price (10/22/23) of Tesla stock (TSLA) is $211.99. An investor whoholds 100 shares of TSLA believes the stock will rise in value. A call option can bepurchased, which provides the option to buy TSLA stock at a set price sometime inthe future. The investor buys a call option on 100 shares today, at a price of $14.00per share. The option has a strike price of $205 per share. The option expires onNovember 3, 2023. How much does the option cost the investor today?O $1,400O $211.99O $21,199O $20,500

Current price: $211.99Strike price: $205Call option premium: $14Number of shares: 100

Answered: The current price (10/22/23) of Tesla…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Similar questions

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Suppose the price of a share of Google stock is $500. An April call option on Google stock has a premium of $5 and an exercise price of $500. The holder of the call option will earn a profit if the price of the share A. increases to $504. B. decreases to $490. C. increases to $506. D. decreases to $496.
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DD Center Strike 12) Calls/Puts 80 Calls Ticker Bid 21-Jan-22 (0d); CSize 100; R.26; IFwd 216.06 5.80 1 TGT 1/21/22 C210 2) TGT 1/21/22 C212.5 3) TGT 1/21/22 (215 4 TGT 1/21/22 C217.5 5) TGT 1/21/22 C220 3.65 1.77 56 15 10 Puts Calls 10.00 4.60 1.76 .62 Ask 7.40 6.10 2.28 .89 .26 19 Term Structure 1) Moneyness 21.60 13.80 8.65 5.15 2.95 Last 18-Feb-22 (28d); CSize 100; IDiv .78 USD; R .26; IFwd 215.32 TGT 2/18/22 C200 7) TGT 2/18/22 C210 17.55 20.00 10.25 4.90 TGT 2/18/22 C220 TGT 2/18/22 C230 100 TGT 2/18/22 C240 1.96 .73 18-Mar-22 (56d); CSize 100; IDiv .78 USD; R.26; IFwd 215.36 11) TGT 3/18/22 C200 20.15 12) TGT 3/18/22 C210 13.45 130 TGT 3/18/22 C220 8.35 14 TGT 3/18/22 C230 4.85 15) TGT 3/18/22 C240 2.70 7.35 6.65y 2.10 .80 21 28.50y 10.80 5.15 1.98 .72 29.00y 14.25 9.65 5.10 2.85 IVM 118.18 130.35 66.42 64.54 60.19 37.18 29.19 27.75 27.49 28.22 35.07 32.58 31.34 31.07 31.08 Volm Strike Puts Ticker Bid 21-Jan-22 (0d); CSize 100; R 26; IFwd 216.06 .18 44 89 1.96 3.90 Ask .31 .59 5…
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