A Put Option That Is Described as in the Money

question 80

Multiple Choice

A put option that is described as in the money would find:

• A)The market price of the stock above the strike price.
• B)The strike price is above the market price of the stock.
• C)The market and strike prices are the same.
• D)The option has been exercised.

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Definitions:

Journal Entries

Recorded transactions or adjustments in the financial records of a company, marking the debit and credit of accounts affected by business operations.

Debt Ratio

A ratio indicating the level of a firm's indebtedness by dividing its total obligations by its overall assets.

Financial Leverage

The use of borrowed funds to increase the potential return on investment.

General Journal

A comprehensive journal that records the initial data for all different types of financial transactions.