-Refer to Exhibit 4-1

question 63

Multiple Choice

-Refer to Exhibit 4-1.The number of units bought and sold at the price ceiling is

• A) 75.
• B) 125.
• C) 175.
• D) 100.

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Definitions:

Lower Bound

The minimum value that a financial instrument, such as an option, can decrease to, taking into account current market conditions.

Buy Puts

An investment strategy that involves purchasing put options, contracts that give the buyer the right, but not the obligation, to sell a security at a specified price before the contract expires.

Rational Investor

An individual or entity that makes investment decisions based on logical analysis, aiming to maximize returns while minimizing risks.