Exhibit 13-4
USE THE FOLLOWING INFORMATION FOR THE NEXT PROBLEM(S) $\$ 3.25$

Multiple Choice

Exhibit 13-4
USE THE FOLLOWING INFORMATION FOR THE NEXT PROBLEM(S)
Rick Thompson is considering the following alternatives for investing in Davis Industries, which is now selling for $44 per share: 1) Buy 500 shares, and
2) Buy six month call options with an exercise price of 45 for $\$ 3.25$ premium.
-Refer to Exhibit 13-4. Assuming no commissions or taxes, what is the annualized percentage gain if the stock is at $30 in four months and the stock was purchased?

A) 9.54% loss
B) 95.45% loss
C) 0.9545% gain
D) 95.45% gain
E) 9.54% gain