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:

Welfare Benefits

Financial assistance provided by the government to individuals or groups in need, aiming to support well-being and economic stability.

Stocks And Bonds

Stocks and bonds are financial instruments; stocks represent ownership shares in a company, while bonds are debt securities issued by entities like governments or corporations to raise capital.

Gross Domestic Product

The total market value of all final goods and services produced within a country in a given period, used as a broad measure of economic activity.

Exports

Goods or services produced in one country and sold to buyers in another country, contributing to the exporting country's gross domestic product.