You Purchase One IBM 70 Call Option for a Premium

question 28

Multiple Choice

You purchase one IBM 70 call option for a premium of $6.Ignoring transaction costs,the break-even price of the position is

• A) $98
• B) $64
• C) $76
• D) $70
• E) none of these

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Definitions:

Bias

A tendency or prejudice towards or against something or someone in a way that is considered to be unfair, affecting impartial judgment.

Pilot Testing

An initial small-scale implementation used to test and refine a project, study, or product before full scale execution or launch.

Internal Consistency

Internal consistency is a measure of the reliability of a test or scale; it assesses the extent to which all parts or items of a survey measure the same concept or construct and therefore reflects the interrelatedness of the items within the test.

Cronbach's Alpha

A measure of internal consistency or reliability of a psychometric instrument, indicating how well the items in a test measure the same underlying concept.