Buying a Put at $13 and Selling a Call at $14

question 51

Multiple Choice

Buying a put at $13 and selling a call at $14 is an example of a:

• A) butterfly.
• B) floor.
• C) cap.
• D) collar.

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Definitions:

Spending Variance

The difference between the actual amount spent and the budgeted amount for a particular item or category.

Direct Materials

The raw materials and components that are directly incorporated into a finished product and can be easily traced to it.

Activity Level

A measure of the volume of production or services that determines the amount of costs incurred in a business.

Administrative Expenses

Costs related to the general operation of a business, such as salaries of executive personnel, accounting, and human resources.