How Much Must the Stock Be Worth at Expiration in Order

question 75

Multiple Choice

How much must the stock be worth at expiration in order for a call holder to break even if the exercise price is $50 and the call premium was $4?

• A) $46
• B) $50
• C) $52
• D)$54

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Definitions:

Self-Efficacy

An individual's belief in their own ability to succeed in specific situations or accomplish a task.

Community Psychology

A field of psychology that has highlighted the need for the prevention of mental disorders and the promotion of mental health, as opposed to exclusive reliance on treatment approaches; applies an ecological perspective that stresses the interdependence of the individual, the family, community, and society; embodies sensitivity to a person’s social context and appreciation of diversity; pays more attention to people’s strengths and the promotion of wellness, in contrast to the clinical psychology focus on deficits and reduction of maladaptive behaviors; stresses the importance of informal social supports, rather than relying solely on professional help; and is oriented to social justice and social change.

Ecological Approach

A perspective within psychology and other social sciences that emphasizes the importance of understanding individuals in the context of their physical and social environments.

Interdependence

A mutual reliance between two or more groups or people, where each is dependent on the others for certain needs or outcomes.