The premium for a contract of 100 call options is $400. The strike (exercise) price per share is $30 and the current market price of a share is $33. The investor should:

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The investor should exercise the options in order to minimize the loss to $100. The cost of exercising 100 call options at the strike price of $30 per share is $3000. The market price of the shares is $33, so they can be sold for $3300. The profit from exercising the options is $3300 - $3000 = $300. However, since the premium paid for the options is $400, the investor will have a net loss of $100 if they choose to exercise the options. Allowing the options to expire would result in a loss of the entire premium.

The Premium for a Contract of 100 Call Options Is