You Sold a $25 Put Contract on EDF Stock at an Option

question 30

Multiple Choice

You sold a $25 put contract on EDF stock at an option price of $1.10.What does the stock price have to be for you to break even on this contract?

• A)$25.00
• B)$23.90
• C)$1.10
• D)$26.10
• E)$0

Appreciate the role of assumptions in economic modeling and the scientific method in economics.

Understand that personal and societal costs and benefits guide human decisions in predictable ways.

Understand the concept of rational decision-making in economics.

Comprehend how changes in personal benefits and costs influence behavior.

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Definitions:

Self-Regulation

The process by which individuals control their behavior, emotions, and thoughts towards achieving long-term goals.

Natural Selection

A fundamental mechanism of evolution, where individuals that have certain inherited traits tend to survive and reproduce more successfully than others.

Reproductive Success

The transmission of genes to offspring in a manner that enables those offspring to further pass those genes to subsequent generations.

Mating Preference

The set of attributes or characteristics an individual finds desirable or selects for in a potential mate, influenced by genetic, environmental, and social factors.