Hall, Inc, Enters into a Call Option Contract with Bennett Investment

question 27

Multiple Choice

Hall, Inc., enters into a call option contract with Bennett Investment Co. on January 2, 2011. This contract gives Hall the option to purchase 1,000 shares of WSM stock at $100 per share. The option expires on April 30, 2011. WSM shares are trading at $100 per share on January 2, 2011, at which time Hall pays $100 for the call option. Assume that the price per share of WSM stock is $120 on April 30, 2011, and that the time value of the option has not changed. In order to settle the option contract, Hall, Inc., would most likely

• A) pay Bennett Investment $20,000.
• B) purchase the shares of WSM at $100 per share and sell the shares at $120 per share to Bennett.
• C) receive $20,000 from Bennett Investment.
• D) receive $400 from Bennett Investment.

---

Definitions:

Suicide Rates

The statistical measure of the number of suicide deaths in a specified population, typically expressed per 100,000 individuals per year.

Global Structures

refers to the large-scale patterns and systems that affect individuals and societies worldwide, including economic, political, and cultural dimensions.

Mesostructures

Intermediate-scale structures or frameworks that exist between the macro and micro levels, such as community organizations or networks.

Microstructures

The small-scale, intricate social, physical, or biological arrangements and patterns that make up a larger system or society.