Suppose XYZ Is Priced at $125 a Share,has a Call

question 9

Essay

Suppose XYZ is priced at $125 a share,has a call with an exercise price of $150 and two months to expiration that costs $0.125 per contract.Why do you suppose investors would be willing to purchase a call that is so far out of the money?

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Definitions:

Psychological Disorders

Mental health conditions characterized by persistent changes in mood, behavior, and cognitive functions, impacting daily life.

Psychological Health

The aspect of overall health that involves emotional, psychological, and social well-being, affecting how we think, feel, and act.

Negative Thoughts

Automatic and pessimistic assessments about oneself, one's future, or the world, often associated with depressive and anxiety disorders.

Psychological Care

The provision of support and intervention to improve mental health and emotional well-being.