Question: Please help as i am trying to study. I will leave you a rating. thanks! A buyer of a call option will want the value
A buyer of a call option will want the value of the underlying asset to and a writer of a put option will want the value of the underlying asset to A) decrease, decrease C) increase, decrease B) decrease, increase D) increase, increase What combination of puts and calls can simulate a short stock investment? A) Long call and short put B) Long call and long put C) Short call and short put D) Short call and long put Suppose you purchase one MSFT August 77 call contract quoted at $9 and write one MSFT August 82 call contract quoted at $7. If, at expiration, the price of a share of MSFT is $79, your profit would be A) $0B) C) $100 D) $150 Which of the following explanation is consistent with a long put strategy? A) The investor expects the price to increase B) Stable prices are anticipated C) The investor expects the price of the stock to decrease. D) The investor has a long term investment horizon Which strategy benefits from upside price movement and has protection should the price of the security fall? A) Bull spread B) Long put C) Short call D) Straddle An investor purchases a long put at a price of $2.50. The exercise price is $35.00. If the current stock price is $35.50, what is the break even point for the investor? A) $32.50 B) $35.00 C) $37.50 D) $37.60 The price of a long put option is correlated with the stock price and correlated with the exercise price. A) negatively, negatively B) negatively, positively C) positively, negatively D) positively, positively ) is the difference between the option price and intrinsic value A) Face value B) Par value C) Exercise price D) Time value
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