You Purchased a Stock for $43 a Share,sold a Call

question 55

Multiple Choice

You purchased a stock for $43 a share,sold a call option with an exercise price of $40,and bought a put option with an exercise price of $45.What will be the value of your position when the options expire if the stock price is $48 a share?

• A) $48
• B) $46
• C) $56
• D) $40

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Definitions:

Skin Conductance

A measure of the electrical conductance of the skin, reflecting the sweat gland activity, often used as an indicator of emotional or physiological arousal.

Normal Distribution

A bell-shaped frequency distribution curve that is symmetrical about the mean, showing that data near the mean are more frequent in occurrence.

Confounding Variables

Confounding Variables are external factors in a study or experiment that could influence or distort the relationship between the variables being examined.

Extraneous Variables

Variables that are not the focus of a study but can affect the outcome of research if not properly controlled.