Suppose You Purchase One WFM May 100 Call Contract at $5

question 82

Multiple Choice

Suppose you purchase one WFM May 100 call contract at $5 and write one WFM May 105 call contract at $2. The maximum loss you could suffer from your strategy is

• A) $200.
• B) $300.
• C) zero.
• D) $500.

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Definitions:

Psychological Reactance

The emotional response in opposition to a restriction on personal freedoms or choices, leading to an urge to regain them.

Sensory Overload

A condition where one or more of the body's senses experiences over-stimulation from the environment.

Yielding

The act of giving way or conceding to another in a particular situation, often reflecting a form of compliance or adaptability.

Inoculation

A process to stimulate the body's immune response through the administration of a vaccine.