A Speculator Buys a Call Option for $3, with an Exercise

question 2

Multiple Choice

A speculator buys a call option for $3, with an exercise price of $50. The stock is currently priced at $49, and rises to $55 on the expiration date. What is the stock price at which the speculator would break even? ​

• A)$50
• B)$58
• C)$52
• D)$53
• E)$49

---

Definitions:

Relative Deprivation

The perception that one is worse off compared to those with whom one compares oneself.

Research Articles

Scholarly papers published in academic journals that present original research findings or reviews in a specific field of study.

Research Study

A systematic investigation, including research development, testing, and evaluation, designed to develop or contribute to generalizable knowledge.

Adaptation-Level Phenomenon

A psychological principle suggesting that individuals judge new stimuli based on past experiences and their current level of adaptation.