Suppose a Novice Investor Buys a Call Option on 45,000

question 9

Multiple Choice

Suppose a novice investor buys a call option on 45,000 barrels of oil with an exercise price of $45 per barrel and simultaneously buys a put option on 45,000 barrels of oil with the same exercise price of $45 per barrel. Her net payoff per barrel on these option contracts is ________ if the market price per barrel is $43 and ________ if the price per barrel is $47.

• A) −$2; $2
• B) −$2; $0
• C) $0; $2
• D) $2; −$2
• E) $2; $2

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Definitions:

Organizational Results

Outcomes or achievements that an organization aims for, which can include financial performance, operational efficiency, or market position.

Behaviours

Pertains to the actions or reactions of individuals or groups in response to external or internal stimuli.

Skills

Refers to the abilities and expertise that individuals possess, which enable them to perform specific tasks effectively.

Career Planning

The ongoing process of setting personal career goals and designing a path to achieve them, often involving considerations of required skills, education, and training.