Which One of the Following Is Correct for the Owner

question 91

Multiple Choice

Which one of the following is correct for the owner of a June call, valued at $3, on XYZ Corp. with a strike price of $60? XYZ Corp. currently trades at $55.

• A) XYZ stock will go to $63 per share within the option period.
• B) The option should be exercised now.
• C) The option owner's current profit is $3 per share.
• D)The option may expire without value.

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Definitions:

Chronic Deficits

Persistent shortfalls where expenditures exceed revenues over a long period, often leading to increased public debt.

National Debt

The total amount of money that a country's government has borrowed.

Automatic Stabilizers

Economic policies and programs, such as unemployment insurance and taxation, that automatically adjust to help stabilize an economy during fluctuations.

Federal Budget Deficits

Occurs when a government's total expenditures exceed the revenue that it generates, excluding money from borrowings.