You Sold (Wrote) Three TXA Call Option Contracts with a Strike

question 84

Multiple Choice

You sold (wrote) three TXA call option contracts with a strike price of $35 when the option was quoted at $2.60. The option expires today when the value of TXA stock is $33.70. Ignoring trading
Costs and taxes, what is your total profit or loss on your investment?

• A) $0
• B) $260
• C) $390
• D) $780
• E) $1,170

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Definitions:

Statistical Average

A value that signifies the central or typical value in a set of data, calculated by dividing the sum of all values by the number of values.

Stimulation Necessary

The requirement for physical or mental stimulation to facilitate learning, development, or achieving a heightened state of activity.

Top-Down Processing

A cognitive approach in which perception starts with the brain and works down to smaller details, using expectations and knowledge to interpret sensory input.

Sensory Information

Information received through the senses (sight, hearing, touch, taste, and smell), which is then processed by the brain to understand and interact with the environment.