An investor executes a straddle with a call premium of $3.86 and a put premium of $2.43. If the strike price is $80 and the stock price at expiration is $91.12, what is the profit per share?
A) $4.83
B) $7.26
C) $11.12
D) $8.69
E) $5.06

Question

Quizplus · Accepted Answer

The profit per share is calculated as the stock price at expiration minus the strike price minus the total premiums paid: ($91.12 - $80) - ($3.86 + $2.43) = $4.83.

An Investor Executes a Straddle with a Call Premium of $3.86