Which of the Lines Is a Graph of the Profit

question 37

Multiple Choice

Which of the lines is a graph of the profit at maturity of writing a call option on €62,500 with a strike price of $1.20 = €1.00 and an option premium of $3,125?

• A)A
• B)B
• C)C

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Definitions:

Indirect Method

A financial reporting approach used to prepare the cash flow statement, where net income is adjusted for non-cash transactions, changes in working capital, and other items.

Cash Dividends

Distributions of a company's earnings to shareholders in the form of cash.

Dividends Payable

A liability recorded when a company declares dividends but has not yet paid them to shareholders.

Cash Payments

Outflows of cash made by a business, including expenses, creditor payments, and other liabilities, during a specific period.