Assume That You Purchased Shares of a Stock at a Price

question 69

Multiple Choice

Assume that you purchased shares of a stock at a price of $35 per share.At this time you wrote a call option with a $35 strike and received a call price of $2.The stock currently trades at $70.Calculate the dollar return on this option strategy.

• A) $25
• B) -$2
• C) $2
• D) -$25
• E) $0

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Definitions:

Particular Activity

A specific action or endeavor undertaken by individuals or groups.

State of Mind

A person’s emotional and psychological condition at a particular time.

Supererogatory Actions

Actions that go beyond what is morally required or expected, typically considered voluntary and commendable but not obligatory.

Kant's Categorical Imperatives

Fundamental principles in Immanuel Kant's ethical theory that command us to act in a universally acceptable way, independent of our desires.