Eduardo Owns an Option That Gives Him the Right to Purchase

question 15

Multiple Choice

Eduardo owns an option that gives him the right to purchase shares of ABC stock at a price of $18 a share.Currently,the stock is selling for $21.60.He would like to profit on this stock but is not permitted to exercise his option for another 2 weeks.Contrary to other investors,he believes the stock price will decline significantly over the next 2 weeks.Given this situation,he should

• A)sell his option today.
• B)buy call options today that expire in 2 weeks.
• C)wait for 2 weeks and then immediately exercise his option.
• D)purchase shares of ABC today and then sell his option in 2 weeks.
• E)just forget about it because he cannot profit from this situation.

Comprehend the significance of quantity flexibility and other contractual clauses on supply chain efficiency.

Recognize the need to consider multiple dimensions in supplier comparison and selection.

Acknowledge the importance of design collaboration for supply chain and procurement efficiency.

Understand the benefits and impacts of effective sourcing decisions.

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Definitions:

Role Conflict

Occurs when an individual faces incompatible demands or expectations from different roles they are required to perform.

Position Power

The authority or influence a person has due to their role or position within an organization or group.

Formal Authority

The power granted to an individual or group through official or legal means within an organization or society.

Rewards and Punishments

Mechanisms intended to influence behavior by providing positive or negative consequences for actions.