How Much Option Premium Per Share Will You Receive If

question 41

Multiple Choice

How much option premium per share will you receive if you sell a September $34 put on General Electric stock?

• A) $1.64
• B) $1.68
• C) $1.77
• D) $2.52
• E) $2.56

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Definitions:

Returns

The profits or losses generated by an investment over a specific period, often expressed as a percentage of the initial investment cost.

Years

Units of time representing a period of twelve months or 365 days, used as a measure of time passing.

Standard Deviation

A statistic that measures the dispersion or variability of a distribution, indicating how much individual values deviate from the mean.

Long Bonds

Bonds with a long duration to maturity, typically more than 10 years, and are sensitive to interest rate changes.