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John has been lollowing the stock market very dosely over the past 18 months and has a strong belief that future stock prices will be significantly higher. He has two allornatives that he can follow. The first is to use a long-term strategy-purchase the stock loday and sell it sometime in the future at a possibly higher price. The other alternative is to buy a three-month call opton. The relevist information needod to annlyre these alternatives is presented bekw: Current stock price =$48 Desires to buy one round lot =100 shares Three-month call option has a strikn price of $52 and a call premium of $3 a. In scenario one, if the stoek price three manths from now is $59 : 1. What is the long-position profit oe loss? 2. What is the breakeven point of the call option? 3. Is the option in or out of the money? 4. What is the option prolt or loss? a4. If the shock proe three months from now is 569 , the lorg postion profit (or loss) is 4 (Round to the nearest dollar. Enter as a posifve number for profit and a negative number for a loss.) b. In scenario two, if the stock price three months from now is $43 : 1. What is the long-position profit or loss? 2. What is the breakeven point of the call option? 3. Is the option in or out of the money? 4. What is the option profit or loss

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