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For the Writer of a Put Option,if the Underlying Share

Question 40

Multiple Choice

For the writer of a put option,if the underlying share price:


A) moves above the strike price the potential profits are unlimited.
B) drops below the strike price the potential profits are unlimited.
C) moves above the strike price, the potential profits are limited to the premium.
D) moves above the strike price, the premium is reduced by the difference.

Correct Answer:

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