The market price of Delta
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Lew paid $300 to purchase a call on Delta stock with a strike price of $25. What does the market price of Delta have to be for Lew to break-even on his option investment? Ignore transaction costs and taxes.
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This post shows how to calculate the market price of Delta by ignoring transaction costs and taxes.
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Let X is the break-even price, then his gain from call option is Max (X-$25, 0) i,e if the price is above $25, Lew ...
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