You Have Shorted a Call Option on WSJ Stock with a Strike

question 45

Multiple Choice

You have shorted a call option on WSJ stock with a strike price of $50.The option will expire in exactly six months.If the stock is trading at $60 in three months,what will you owe for each share in the contract?

• A)$0
• B)$60
• C)$50
• D)$10
• E)$40

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Definitions:

Coordinating Mechanism

A system or method used to align actions and activities among different parties to achieve a common goal or objective.

Economizing Problem

The choices necessitated because society’s economic wants for goods and services are unlimited but the resources available to satisfy these wants are limited (scarce).

Consumer Desire

The inclination or preference of consumers towards certain products or services they wish to purchase.

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Laborers who are engaged in harvesting strawberries from farms or fields, often seasonal work.