Calculate the Return on Exercising a Put Option That Was

question 63

Multiple Choice

Calculate the return on exercising a put option that was purchased for $10, with an exercise price of $85. The stock price at expiration is $81.

• A) -60%
• B) 60%
• C) 30%
• D)-30%

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Definitions:

Scientific Method

A systematic procedure for acquiring knowledge that involves observation, hypothesis formulation, experimentation, and conclusion drawing to test validity.

Applied Research

Research conducted to solve practical problems rather than to acquire knowledge for knowledge's sake.

Theoretical Research

Research designed specifically to test some developmental explanation and expand scientific knowledge.

Hypothesis

A prediction stated in a way that permits it to be tested.