The Price of a Stock on February 1 Is $124

question 15

Multiple Choice

The price of a stock on February 1 is $124.A trader sells 200 put options on the stock with a strike price of $120 when the option price is $5.The options are exercised when the stock price is $110.The trader's net profit or loss is

• A) Gain of $1,000
• B) Loss of $2,000
• C) Loss of $2,800
• D) Loss of $1,000

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