You sold (wrote) 1 call option on IBM stock with an exercise…

You sold (wrote) 1 call option on IBM stock with an exercise price of $30 for $7.76 and bought 1 call option on the same stock with an exercise price of $40 for $2.45. Both options expire in 5 months. Such a portfolio is called a bear spread.  What is your total profit if the stock price is $100 in 5 months (in $)? Report your answer in two decimal places.

Using the main model output (js.out) below, estimate the pro…

Using the main model output (js.out) below, estimate the probabilities that an Urban Private-sector worker responds ‘Low’, ‘Med’, or ‘High’. Model coefficients: (Intercept) Sector.L Region.L Med −0.103421 0.0672481 0.3158204 High −0.317653 −0.1203895 0.6421537 Coding: x₁ = 0 (Private), x₁ = 1 (Public); x₂ = 0 (Rural), x₂ = 1 (Urban). Compute π-hat_Low, π-hat_Med, and π-hat_High for a Private (x₁=0) Urban (x₂=1) worker.