Break-Even Point Assignment | Homework For You
May 21st, 2020
2. The market price for Alibaba Group Holding Limited. (Ticker: BABA) was $198.74 when Mary sold a put option today. The put premium is $8.45 and the exercise price is $185. The option will be expired on May 15, 2020. (12.5 points)

a. Draw the contingency graph for Mary. Label each point/interaction on the graph. (3.5 pts)
b. What is the break-even point for Mary? (1.5 pts)
e. What are Mary’s maximum profit and maximum loss? (3 pts)
d. Show the profit/loss for Mary if, at the expiration date, the BABA price is (I) $175, (2) $181, and (3) $250.(4.5 pts) Get Finance homework help today
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