At What Point on the Graph of Possible Values for a Call

question 32

Multiple Choice

At what point on the graph of possible values for a call option does the buyer break even financially?

• A) When stock price equals strike price
• B) At any point on the upward-sloping segment of the graph
• C) When stock price equals cost of the option plus strike price
• D) At the point where the graph intercepts the y-axis

---

Definitions:

Defense Mechanism

Psychological strategies employed unconsciously to protect oneself from anxiety arising from unacceptable thoughts or feelings.

Displacement

A defense mechanism where negative emotions or impulses are transferred from the original source to a less threatening object or person.

Reprimanded

Being reprimanded involves receiving a formal expression of disapproval for one's actions or behavior, often in a professional or academic setting.

Anally Fixated

A term from Freudian psychoanalysis indicating a person who is said to have unresolved conflicts during the anal stage of development, potentially leading to traits such as obsessiveness, stinginess, or orderliness.