Three Months Ago,you Purchased a Put Option on WXX Stock

question 19

Multiple Choice

Three months ago,you purchased a put option on WXX stock with a strike price of $60 and an option price of $.60. The option expires today when the value of WXX stock is $62.50. Ignoring trading costs and taxes,what is your total profit or loss on your investment?

• A) -$310
• B) -$60
• C) $0
• D) $60
• E) $190

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Definitions:

Maturity Date

The specific date on which the principal amount of a bond, loan, or other financial instrument is scheduled to be repaid.

Issued

Referring to securities or documents that have been officially released or distributed by an entity.

Due Date

The specific date by which a task needs to be completed or a payment needs to be made.

Maker

An entity or individual who creates or produces something, often used in contexts such as product manufacturing or software development.