Elisa would like to participate in the limited upside of yz


Elisa would like to participate in the limited upside of YZ, Inc. As an option writer, she wrote (or sold) five YZ, Inc. call contracts with an exercise price of $6 expiring in 3 months. The premium is $2 each. If the stock price at expiration is $7, the buyer exercises his/her contracts. What is the net profot or loss of her investment, assuming that there are no transaction costs?

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Finance Basics: Elisa would like to participate in the limited upside of yz
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