Harry Rockefeller purchased 1 share of Dell Computer for $94.25 in 1998. Recently, Dell price per share is falling to $80; therefore, Harry decided to purchase European’s, which is with an exercise price of $80. Each put is priced at $5.25. If Harry would like to know what would happen if he purchased 100 shares instead of 1 share, Harry now would have to apply a best-case-scenario- versus-a worst-case-scenario model. From the model, his worst case is a 57.56% loss, whereas if he buys 1 put, his worst case is only a 19.6% loss. With no puts, each $1 decrease in Dell’s price decreases his return by 1.06%. Therefore, purchasing 1 put, makes Harry immune to decrease in Dell’s stock price below $80. On the other hand, Harry’s maximum return is at 50.75%, and if he buys no puts, his maximum return is 59.15%. All in all, if Harry purchases 100 shares of stock rather than 1, it will be multiplied by the appropriate quantities in the model by 100. For example, if he decides to buy, say 3 puts to hedge the risk from owning 1 share of stock, he will probably buy 300 puts if he owns 100 shares.