Multiple Choice
Assume that you have purchased a call option with a strike price $60 for $5. At the same time, you purchase a put option on the same stock with a strike price of $60 for $4. If the stock is currently selling for $75 per share, calculate the dollar return on this option strategy.
A) $10
B) -$4
C) $5
D) $6
E) $15
Correct Answer:
Verified
Correct Answer:
Verified
Q1: According to put/call parity:<br>A) Stock price +
Q2: A stock currently sells for $75 per
Q4: A primary function of futures markets is
Q5: Derivative securities can be used<br>A) by investors
Q6: A stock currently trades at $110. June
Q7: The price at which the stock can
Q8: USE THE INFORMATION BELOW FOR THE FOLLOWING
Q9: Which of the following does NOT influence
Q10: An option to sell an asset is
Q11: Consider a stock that is currently trading