The Maximum Payoff to the Seller of a Call Is

question 47

Multiple Choice

The maximum payoff to the seller of a call is

• A)zero.
• B)equal to the stock price.
• C)equal to the exercise price.
• D)not quantifiable.
• E)unlimited.

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Definitions:

Total Amount Collected

The sum of money received from various sources, including sales, investments, financing, and other business activities.

Gross Profit

The difference between revenue and the cost of goods sold, representing the basic profitability of items or services before deducting operating expenses.

Cost of Goods Sold

The total cost directly associated with producing goods which have been sold.

Merchandise Sold

The products that a business sells to its customers, generating revenue.