A Stock Is Selling at $85 at the Expiration of an Option

question 35

Multiple Choice

A stock is selling at $85 at the expiration of an option contract.Which of the following options will most likely be exercised?

• A)Buyer of a call option with exercise price of $65.
• B)Buyer of a put option with exercise price of $65.
• C)Buyer of a call option with exercise price of $80.
• D)Buyer of a put option with exercise price of $85.

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Definitions:

Effectiveness

The degree to which a method, procedure, or treatment achieves its intended outcome or goal in real-world scenarios.

Demand Characteristics

Experimental cues or conditions that influence participants' behavior or responses in psychological research, potentially biasing the results.

Subtle Hints

Indirect or not clearly stated suggestions that are often used to convey information or influence behavior without direct communication.

Experimental Study

A research methodology that involves manipulating one variable to determine if it causes a change in another variable, within a controlled environment.