A Trader Creates a Long Butterfly Spread from Options with Strike

question 6

Multiple Choice

A trader creates a long butterfly spread from options with strike prices $60,$65,and $70 by trading a total of 400 options.The options are worth $11,$14,and $18.What is the maximum net loss (after the cost of the options is taken into account) ?

• A) $100
• B) $200
• C) $300
• D) $400

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Definitions:

Slave Labor

Work done under force without proper remuneration, often under extremely harsh conditions, primarily referred to in the context of African slaves in the Americas during the colonial and antebellum periods.

Eli Whitney

Known for inventing the cotton gin, a pivotal invention in the history of agriculture and the economy of the United States.

Slaveholders

Individuals or entities that owned slaves.

Owned

Often colloquially used to mean dominantly defeated or embarrassed, typically in a competitive situation or argument.