Calculate the Return on Exercising a Put Option That Was

question 63

Multiple Choice

Calculate the return on exercising a put option that was purchased for $10, with an exercise price of $85. The stock price at expiration is $81.

• A) -60%
• B) 60%
• C) 30%
• D)-30%

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Definitions:

Solvent

A substance, typically a liquid, capable of dissolving other substances to form a solution.

Water

A colorless, tasteless, and odorless substance essential for most plant and animal life and the most widely used solvent.

Solvent

A substance, typically a liquid, capable of dissolving other substances (solutes) to form a solution.

Solute

A material that is dissolved within another material, usually forming the smaller proportion of a solution.