An Option That an Investor Holds Without Holding an Offsetting

question 15

Multiple Choice

An option that an investor holds without holding an offsetting position in the underlying stock is called a(n)

• A) Call option.
• B) Put option.
• C) Out-of-the-money option.
• D) Naked option.
• E) Covered option.

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Definitions:

Interval Estimate

An assortment of values, from sample statistics, which is envisioned to contain the value of a mysterious population parameter.

Population Mean

The average value of all elements in a complete set of a population.

Population Standard Deviation

A measure of the dispersion or spread of a set of data points in a population dataset.

Confidence Interval

A range of values, derived from sample data, that is likely to contain the value of an unknown population parameter with a certain level of confidence.