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Desiree and Johan Have Been Dating for Several Months

question 39

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Desiree and Johan have been dating for several months.One night,Desiree says,"We've been dating for a while now.I'm wondering if we have a future together." Johan responds,"I hope so.I've been wondering myself if we might want to make our relationship more formal." Desiree says,"What did you have in mind?" Johan says,"Well,I don't think an engagement is right just now.But I would like us to commit to dating exclusively." Desiree says,"That was kind of my thinking,too." What strategy for escalating or maintaining a relationship are they employing?


Definitions:

Put Contracts

Financial derivatives that give the holder the right, but not the obligation, to sell a specific amount of a security at a specified price within a specified time period.

Underlying Stock

The stock that is the basis for a particular derivative instrument, such as an option.

Market Value

The current quoted price at which an asset or company can be bought or sold on the open market.

November 47.50 Call

A call option contract for the right to buy a specific financial instrument at a price of 47.50, expiring in November.

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