At What Point Is the Dollar Payoff from Owning a Call

question 6

Multiple Choice

At what point is the dollar payoff from owning a call option on a stock greater than the payoff from owning the stock itself?

• A) When stock price exceeds exercise price at expiration.
• B) When exercise price exceeds stock price at expiration.
• C) When stock price equals exercise price at expiration.
• D) Call payoff never exceeds stock payoff.

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