Your Aunt Agatha Purchased a Call Option a Few Months

question 93

Multiple Choice

Your Aunt Agatha purchased a call option a few months ago.Today is the expiration date,so she must decide whether to exercise the option.Which of the following statements is correct? Do not consider brokers' commissions in your answer.

• A) Aunt Agatha doesn't need to make a decision about exercising the option today;in fact,it would be better if she waited until after the option expires.
• B) Aunt Agatha should exercise the option if the price of the stock is less than the exercise,or strike,price.
• C) Aunt Agatha should exercise the option if the price of the stock is greater than the exercise,or strike,price.
• D) Aunt Agatha should exercise the option,regardless of the current stock price.
• E) None of the above.

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