Which of the Following Is True for an Investor Who

question 54

Multiple Choice

Which of the following is true for an investor who owns a share of stock and has purchased a put option on the stock?

• A) The investor profits when the stock decreases in value.
• B) Maximum loss is the price of the option premium.
• C) The investor is protected against upside potential.
• D) Increases in stock value go to the seller of the put.

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Definitions:

Leader-member Exchange

Describes the relationship dynamic between leaders and their team members, often highlighting the importance of mutual trust, respect, and obligation.

Relationship Quality

The perceived value or excellence of an interaction or relationship, based on factors like trust, satisfaction, and commitment.

Position Power

The authority or influence conferred by one's rank or official standing within an organization.

Personal Power

The influence or authority an individual has over others, derived from personal attributes or skills, rather than formal position.