Kyle Believes the Price of Ajax Stock Is About to Decrease

question 93

Multiple Choice

Kyle believes the price of Ajax stock is about to decrease. If he wants to profit from the decline in price, he should ______on Ajax stock.

• A) buy a call
• B) write a put
• C) buy a put
• D) sell a put

Understand the consensus and disagreements among economists on key economic propositions.

Analyze how differences in values and scientific judgments can lead to conflicting advice from economists.

Comprehend the basic components and movements within coordinate system graphs.

Recognize common errors in reasoning about causation and correlation in economic contexts.

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Definitions:

Net Income

The total profit of a company after all expenses and taxes have been subtracted from total revenue.

Equity Multiplier

A financial ratio that measures the portion of a company's assets that are financed by shareholder's equity, providing insights into leverage.

Profit Margin

A financial performance ratio, calculated by dividing net income by sales revenue, indicating how much profit a company keeps from its sales.

ROE

Return on Equity (ROE) is a measure of financial performance calculated by dividing net income by shareholders' equity, indicating how effectively a company uses investments to generate earnings growth.