Which of the Following Is True for the Owner of a Call

question 11

Multiple Choice

Which of the following is true for the owner of a call option?

• A) The loss potential is unlimited.
• B) The profit potential is unlimited.
• C) The premium exceeds the strike price.
• D) There is no expiration date, unless the option is a European call.

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Definitions:

Wheat Farmers

Individuals or businesses engaged in the cultivation of wheat, a staple grain consumed globally, as their primary agricultural activity.

Total Income

The total amount of money earned or received by an individual or entity within a specified period, including wages, salaries, benefits, and investment earnings.

Price Parity Concept

An economic theory which suggests that in the absence of transaction costs and barriers to trade, identical goods will have the same price in different markets when expressed in the same currency.

Agricultural Policy

A set of laws and guidelines which aim to improve agricultural productivity, manage natural resources, and support farmers' incomes.