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Directions: Apply the knowledge you have gained from Chapter 8 to select the best answer to the questions about the following reading passage.
Riding up the mountain trail, my thighs ached and my lungs burned, but I couldn't be happier. Fifty feet in front of me pedaled my brother, Keith, fresh off his tour with the Marines. This mountain biking adventure was his idea. The green, forest-lined trail was rugged, with sharp turns and steep descents. At one point we hit a patch of fog and I lost sight of Keith. It felt as if we were riding through clouds. The ghostly air was damp and smelled like rain. I slowed down and called for my brother, 'Are you still up there?' 'Would I be anywhere else?' he yelled back. When the fog disappeared, we stopped for a breather on a ridge that overlooked a vast valley. A sea of pointy evergreens stretched for miles, ending near the peak of a distant mountain. While I snacked on a peanut butter granola bar, Keith glanced over at me and said, 'This is fun, isn't it?' 'It's good having you back, man,' I responded. With that, we hopped on our bikes.
What is the purpose of the reading passage?
Intrinsic Value
The perceived or calculated true value of an asset, investment, or company based on fundamental analysis rather than current market price.
Equilibrium
A state in which market supply and demand balance each other, resulting in stable prices and no tendency for change.
Call
An options contract that gives the investor the right, but not the obligation, to buy a stock, bond, commodity, or other instrument at a specified price within a specific time period.
Put
A financial derivative option that gives the holder the right, but not the obligation, to sell a security at a specified price within a specified time.
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