D 60 ANSWER: C Exhibit 2-4
a Sample of 15

question 48

Multiple Choice

d. 60 ANSWER: c Exhibit 2-4
A sample of 15 children shows their favorite restaurant:
$\begin{array}{|l|l|l|}\hline \text { McDonalds } & \text { Luppi's } & \text { Mellow Mushroom } \\\hline \text { Friday's } & \text { McDonalds } & \text { McDonalds } \\\hline \text { Pizza Hut } & \text { Taco Bell } & \text { McDonalds } \\\hline \text { Mellow Mushroom } & \text { Luppi's } & \text { Pizza Hut } \\\hline \text { McDonalds } & \text { Friday's } & \text { McDonalds }\\\hline\end{array}$
-Refer to Exhibit 2-4. Determine the percent frequency for McDonalds.

• A) 10%
• B) 27%
• C) 2%
• D) 40%

Analyze the impact of market conditions on different option strategies.

Calculate expected profits for option writers under various market scenarios.

Understand how synthetic positions can mirror the payoffs of other financial instruments.

Identify strategies to profit from or hedge against specific market movements.

---

Definitions:

Price Sensitivity

The degree to which the demand for a product or service is affected by changes in its price.

Unconditional Warranty

A guarantee provided on a product that offers coverage or repair without any conditions or limitations.

Break-even Quantity

is the volume of sales a business must achieve to cover all its costs, without making a profit or a loss.

Marginal Revenue

The additional income generated by selling one more unit of a good or service.