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Corporate Finance · End Term · 22 Dec 2024 · September 2024 term · Set QDB3

Question 18: The share price for Infosys is Rs 500 today. A trader in…

Question 18

+3 marksOne correct option

The share price for Infosys is Rs 500 today. A trader invests in Infosys by buying 100 European call options on Infosys for Rs 10 each with a strike price of Rs 490 and maturity of three months. What is the gain or loss if the share price on the maturity date is Rs 495?

  1. A

    Rs 0, no gain, no loss

  2. B

    Rs 500 loss

  3. C

    Rs 500 gain

  4. D

    Rs 1000 loss

Show answer

Correct answer

  • B

    Rs 500 loss

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Question 18 of 35 in the IIT Madras BS Corporate Finance (Corporate Finance) End Term paper sat on 22 Dec 2024, in the September 2024 term (IIT M DEGREE AN EXAM QDB3 22 Dec 2024). It carries 3 marks.

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