The Price of a Stock on February 1 Is $48

question 7

Multiple Choice

The price of a stock on February 1 is $48.A trader sells 200 put options on the stock with a strike price of $40 when the option price is $2.The options are exercised when the stock price is $39.The trader's net profit or loss is

• A) Loss of $800
• B) Loss of $200
• C) Gain of $200
• D) Loss of $900

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Definitions:

Success of the Merger

The positive outcome of combining two or more companies, typically measured by financial performance, market share, and synergies achieved.

Loblaws

A Canadian supermarket chain, offering grocery products, pharmaceutics, banking, and clothing, among other things.

Shoppers Drug Mart

A Canadian retail pharmacy chain offering a wide range of health, beauty, and convenience products and services.

Horizontal Merger

A horizontal merger is a business consolidation that occurs between firms that operate in the same industry, often leading to synergies and an expanded market presence.