, choose Check pace 7. (10%) An investor is bearish (bullish) on a particular stock and decided to buy a put (call) with a strike price of $25. Ignoring commissions, if the option was purchased for a price of $.85, what is the break-even point for the investor on the put and the call respectively? 8. (15%) Suppose you think Wal-Mart stock is going to appreciate in the next year. Current price is $100, and the call option expiring in one year has an exercise price, X, of $100 and is selling at a price, C, of $10. With $10,000 to invest, you invest all in 1,000 options (TO contracts). Alternatively, you can invest all in the stock. What is the rate of return for each alternative if one year later the stock price is $1207