What Is the Put Option Premium Given the Following Information

question 65

Multiple Choice

What is the put option premium given the following information?

• A) $1.20
• B) $1.54
• C) $1.82
• D) $2.01
• E) $2.21

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Definitions:

Market Demand

The overall volume of a good or service that consumers in a market are ready and able to buy across a range of prices.

ATC

Stands for Average Total Cost, which is the total cost of production (fixed plus variable costs) divided by the number of units produced.

Economic Profits

A reiteration emphasizing the calculation that includes total revenues minus total costs, where total costs consider both the explicit and implicit costs.