Kizspy | Question: 12 (Choose 1 answer)
(27604) Corn call options with a $1.70 strike price are trading for a $0.15 premium. Farmer Jayne decides to hedge her 20,000 bushels of corn by selling short call options. Six-month interest rates are 4.0% and she plans to close her position and sell her corn in 6 months. What is her profit or loss if spot prices are $1.60 per bushel when she closes her position?
A. $1,000 loss
B. $2,000 gain
C. $2,120 loss
D. $2,120 gain
