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There are two call options for the same underlying asset and same maturity. One call...

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Finance

There are two call options for the same underlying asset and same maturity. One call option C1 has exercise price of $120 and the other call option C2 has exercise price of $150. Also, one call sells for $8 and the other sells for $10. Select the prices of C1 and C2 from the given two values. Explain your argument for the price selection with the help of payoff and profit diagrams of the call options.

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