You Purchased 6 Call Options with a $40 Strike Price

question 91

Multiple Choice

You purchased 6 call options with a $40 strike price at a total cost of $150.On the expiration date,the underlying stock was priced at $39.20.What is the percentage return on your investment?

• A) -420 percent
• B) -100 percent
• C) 68.75 percent
• D) 2.02 percent
• E) 220 percent

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Definitions:

Rate Of Return

The fiscal growth or shrinkage in an investment's value during a particular lapse of time, marked as a percentage of the initial investment expense.

Annual Dividend

The total amount of dividends that a company pays out to its shareholders over a year.

Market Rate

The prevailing interest rate available in the marketplace on investments or loans.

Dividend Growth Rate

The annualized percentage rate of growth of a company's dividend payments, indicating the stability and growth potential of the dividends over time.