10. Suppose the price of a share of IBM stock is $100. An April call option on IBM stock has a premium of $5 and an exercise price of $100. Ignoring commissions, the holder of the call option will earn a profit if the price of the share a. increases to $104. b. decreases to $90. c. increases to $106. d. decreases to $96. e. None of these is correct.

The answer is C.

Explanation:

Call option is a financial contract that gives the holder(holder of call option) the right but not the obligation to buy an asset(bond, equity etc.). The holder of call option expects the underlying assets to increase in future.

The excercise price or strike price is $100

The premium(the price paid by the buyer to the seller to obtain this right) is $5

The total is $105($100 + $5)

So for profit to be recorded, this must be over $105 which is from $106.

start by isolating the variable on one side by adding 43w^2 to both sides.   the equation will read:

25w^2+5=0

*subtract 5 from both sides*

25w^2=-5

*divide both sides by 25*

w^2=-1/5

*take the square root of both sides*

w=√(-1/5)

the square root of -1 is i.   the square root of 5 remains √5

the answer is i/√5.

hope this

d. automatic stabilizers.

explanation: