You Own 200 Shares of Delta Stock, Which Is Currently

question 21

Multiple Choice

You own 200 shares of Delta stock, which is currently worth $33 a share. You just paid an option premium of $.55 to buy two put contracts on this stock with a strike price of $30. What is the maximum loss per share you are avoiding by purchasing the option contract?

• A)$30.00
• B)$30.85
• C)$32.15
• D)$33.00
• E)$33.85

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Definitions:

Arrival Date

Typically refers to the expected or actual date on which something arrives, often used in the context of goods delivery or travel.

Trade Discount

A reduction in the list price granted by a seller to a buyer based on the volume or value of the purchase.

FOB Shipping Point

A term used in shipping agreements indicating that the buyer is responsible for the goods and the shipping costs as soon as they leave the seller’s premises.

Sales Revenue

The earnings a business obtains through the sale of products or the delivery of services.