The Maximum Loss a Buyer of a Stock Put Option

question 78

Multiple Choice

The maximum loss a buyer of a stock put option can suffer is equal to

• A) the striking price minus the stock price.
• B) the stock price minus the value of the call.
• C) the put premium.
• D) the stock price.
• E) None of the options are correct.

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Definitions:

Negative Antecedent State

A psychological or physical condition that exists before a particular behavior, leading to a reduction in consumer satisfaction or decision-making efficiency.

Temporal Uncertainty

The uncertainty associated with the timing of events, which can affect planning and decision-making processes.

Cognitive Dissonance

A psychological phenomenon where an individual experiences discomfort due to holding conflicting beliefs, values, or attitudes, prompting them to seek resolution.

Perceived Risk

The level of risk that consumers believe is associated with purchasing or using a product or service, which can influence their buying behavior.