The Price of a Stock Is $67

question 7

Multiple Choice

The price of a stock is $67.A trader sells 5 put option contracts on the stock with a strike price of $70 when the option price is $4.The options are exercised when the stock price is $69.What is the trader's net profit or loss?

• A) Loss of $1,500
• B) Loss of $500
• C) Gain of $1,500
• D) Loss of $1,000

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Definitions:

Classical Conditioning

Through a repetitive pairing process, a learning method occurs where a response initially triggered by the second of two stimuli becomes triggered by only the first stimulus.

Social Learning Theory

A theory that posits individuals learn behaviors, skills, attitudes, and beliefs through observing and imitating the actions of others within social contexts.

Biofeedback Theory

A technique that teaches individuals to control bodily processes that are normally involuntary, like heart rate, using monitoring devices.

Unconditioned Stimulus

A stimulus that inherently and instinctively elicits a reaction without needing any learned behavior.