You Purchase One IBM 200 Call Option for a Premium

question 55

Multiple Choice

You purchase one IBM 200 call option for a premium of $6. Ignoring transaction costs, the break-even price of the position is

• A) $194.
• B) $228.
• C) $206.
• D) $211.

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Definitions:

Consolidated Net Income

The total net income of a parent company and all its subsidiaries, after eliminating inter-company transactions and dividends received from the subsidiaries.

Noncontrolling Interest

A minority stake in a company, held by investors or other companies that do not have control over business operations.

Valuation Basis

The method or approach used to determine the value of an asset or a company.

Investment Account

An account established to hold investments such as stocks, bonds, mutual funds, and other assets for long-term growth or income generation.