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Corporate Finance · End Term · 21 Dec 2025 · September 2025 term

Question 23: A trader buys a call option on a stock with a strike pri…

Question 23

+4 marksOne or more correct options

A trader buys a call option on a stock with a strike price of Rs 40 when the call option price is Rs 4. He also buys two put options with the same strike price of Rs 40 and the put option price is Rs 3. The trader makes a profit when the stock price at expiration is

Select all that apply.

  1. A

    Rs 32

  2. B

    Rs 40

  3. C

    Rs 48

  4. D

    Rs 56

Show answer

Correct answers

  • A

    Rs 32

  • D

    Rs 56

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Question 23 of 30 in the IIT Madras BS Corporate Finance (Corporate Finance) End Term paper sat on 21 Dec 2025, in the September 2025 term (Corporate Finance 18 Dec 25). It carries 4 marks.

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