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.
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