At What Point Is the Payoff from Owning a Call

question 61

Multiple Choice

At what point is the payoff from owning a call option on a stock greater than the payoff from owning the stock itself?

• A) When stock price exceeds strike price at expiration
• B) When strike price exceeds stock price at expiration
• C) When stock price equals strike price at expiration
• D)Call payoff never exceeds stock payoff.

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Definitions:

Homosexual Attraction

The emotional, romantic, or sexual attraction to members of the same gender.

Heterosexual Attraction

The emotional, romantic, or sexual attraction to members of the opposite gender.

Immediate Reward

Immediate reward refers to a benefit or gratification received right after completing an action, often influencing behavior and decision-making processes due to its instant satisfaction.

Delayed Reward

A benefit or payoff that is received after a certain period of time has passed, often used in the context of behavior modification or psychology.