Lawrence and Nina Have Always Enjoyed Live Symphony Performances

question 19

Multiple Choice

Lawrence and Nina have always enjoyed live symphony performances. Now that they are nearing 60 years old, Lawrence doesn't enjoy it as much as Nina. It is likely that Lawrence:

• A) cannot hear the high-pitched sounds as well as Nina can.
• B) cannot hear the low-pitched sounds as well as Nina can.
• C) is suffering from memory loss.
• D) is wearing a hearing aid.

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Definitions:

Exercise Price

The pre-determined price at which the holder of an option can buy (in the case of a call option) or sell (in the case of a put option) the underlying asset.

Stock Price

The cost of purchasing a single share of a company's stock.

In The Money

refers to a financial term describing an option that has intrinsic value, meaning for a call option, the market price is above the strike price, and for a put option, the market price is below the strike price.

Put Option

A financial contract giving the holder the right, but not the obligation, to sell a specified amount of an underlying asset at a set price within a certain time frame.