Cara Wrote a Put Option Contract on EZ Stock with an Exercise

question 33

Multiple Choice

Cara wrote a put option contract on EZ stock with an exercise price of $40 per share and an option price of $.65 per share. Today, the contracts expire and the stock is selling for $34.30 a share. What is the net profit on this investment? Ignore trading costs and taxes.

• A) −$635.00
• B) $50.50
• C) $635.00
• D) $63.50
• E) −$505.00

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Definitions:

Perinatal Mortality

Refers to the death of a fetus or an infant during the period shortly before or after birth.

Home Births

The process of giving birth to a child at home rather than in a hospital or birthing center, often with the assistance of a midwife or nurse.

Childbirth

The act or process of giving birth to a baby, marking the end of pregnancy and the beginning of a new life.

Fetal Malnutrition

A condition in which a fetus does not receive adequate nutrients for growth and development during pregnancy.