Exhibit 22.7 USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)

question 35

Multiple Choice

Exhibit 22.7
USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)
GE Corporation has a put option selling for $2.90 and a call option selling for $1.95, both with a strike price of $29.00.
-Refer to Exhibit 22.7. What would the net value of a long strap position be if the stock price at expiration is $35?

• A)-$1.15
• B)-$2.30
• C)$1.15
• D)$2.30
• E)$5.20

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Definitions:

Bumping Rights

Preferential rights allowing more senior employees to displace less senior ones in certain job positions during layoffs or organizational restructuring.

Seniority Provision

A policy or clause giving priority or special rights to employees based on the length of service with an employer.

Greater Tenure

A status achieved by employees that denotes longer service or employment duration, often bringing certain benefits or protections such as job security.

Inverse Seniority

A system used during layoffs where employees with the least amount of seniority are laid off first, as opposed to those with more seniority.