Now let’s say you believe lmn stock will decrease in price of $50/share, so you decide to purchase a june put option for 100 shares for a 30 day time limit. assume that buy 1 option contract, where 1 put option contract equals to 100 shares and the put premium cost per share is $4/share. (6 points total) a) are you the long call or short put option? are you the buyer or seller?
b) how much will you spend for the entire put option contract? assume the price of the share increased to $56 per share,
c) would you exercise the put option?
d) how much would be your gain or loss? assume the price of the share decreased to $40 per share,
e) would you exercise the put option?
f) how much would be your gain or loss?
answer; ///i believe that the correct answer is ( inductive check first good
if the government puts a price ceiling on wheat, they want to make sure that producers aren't selling wheat for a higher amount. a price ceiling is the max price that a producer can price an item to be. by doing this, they make sure that a producer isn't pricing items in demand up extremely high to charge a consumer an obsene amount.