You Want the Right, but Not the Obligation, to Sell

question 71

Multiple Choice

You want the right, but not the obligation, to sell 300 shares of ZZ Industries stock at a price of $30.00 per share and an option cost of $1. How much will it cost you to establish this option position?

• A)$300
• B)$320
• C)$360
• D)$378
• E)$382

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Definitions:

Venture

An undertaking that is typically risky but offers the potential for significant rewards, often associated with new businesses or startups.

Capital

Wealth in the form of money or other assets owned by a person or organization or available for purposes such as starting a company or investing.

Equity Investment

involves purchasing shares of a company, thus obtaining ownership interest in that company.

Management Team

A group of individuals at the top level of an organization who are responsible for its overall direction and strategy.