A speculator writes a put option which can be exercised on or before expiration for a premium of $4, with an exercise price of $30. The stock is presently priced at $29, and rises to $32 before the expiration date without ever trading below $29. What is the profit per unit to the writer if the option is exercised at the owner's ideal time?
This question was asked on Jul 20, 2016 and answered on Jul 20, 2016.
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