The Maximum Loss a Buyer of a Stock Call Option

question 72

Multiple Choice

The maximum loss a buyer of a stock call option can suffer is equal to

• A) the striking price minus the stock price.
• B) the stock price minus the value of the call.
• C) the call premium.
• D) the stock price.
• E) None of the options are correct.

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Definitions:

Pay Raise

An increase in the amount of money an employee receives as wages or salary.

Motivational Level

The degree of enthusiasm, drive, or desire with which an individual or group approaches tasks or goals.

Unsatisfied Need

A requirement or necessity that has not been fulfilled, often driving motivation and action to meet that need.

McClelland's Theory

A motivational theory that suggests individuals are motivated by three primary needs: achievement, affiliation, and power.