Corn call options with 170 strike price are trading for 015


Corn call options with a $1.70 strike price are trading for a $0.15 premium. Corn-2-Pop decides to hedge their 20,000 bushels of corn by selling short call options. Six-month interest rates are 4.0% and they plan to close their position and sell their corn in 6 months. What is their profit or loss if spot prices are $1.60 per bushel when they close their position?

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Financial Management: Corn call options with 170 strike price are trading for 015
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