Which of the Following Is Not True Concerning Call Option

question 43

Multiple Choice

Which of the following is not true concerning call option writers?

• A)Writers promise to deliver shares if exercised by the buyer.
• B)The writer has the option to sell shares but not an obligation.
• C)The writer's liability is zero if the option expires out-of-the-money.
• D)The writer receives a cash payment from the buyer at the time the option is purchased.
• E)The writer has a loss if the market price rises substantially above the exercise price.

---

Definitions:

Affiliation

The relationship or connection between individuals or organizations, typically characterized by a shared purpose or common goals.

Process of Adjustment

The psychological and behavioral process by which individuals adapt to new conditions, circumstances, or environments.

Coping

The strategies or mechanisms individuals use to manage stress, adversity, or emotional distress.

Experimental Group

The subjects in an experiment who receive some special treatment in regard to the independent variable.