You Purchased 7 Put Option Contracts on Alto Industries

question 67

Multiple Choice

You purchased 7 put option contracts on Alto Industries. The strike price was $42.50 and the option premium was $1.30. On the expiration date, the stock was valued at $41.40 a share. What is the payoff on the option contracts?

• A)−$140
• B)$0
• C)$110
• D)$360
• E)$770

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Definitions:

Excessive Moisture

An overabundance of water or humidity, which can lead to negative effects such as mold growth or skin irritation.

Cerumen Buildup

Accumulation of earwax within the ear canal, leading to potential hearing difficulties or discomfort.

Ear Canal

The narrow tube that leads from the outer ear to the eardrum, through which sound travels to reach the inner parts of the ear.

Contact Lens

Thin lenses placed directly on the surface of the eyes to correct visual impairments or for cosmetic reasons.