An Option Trading Strategy That Utilizes Both Put and Call

question 75

Multiple Choice

An option trading strategy that utilizes both put and call options is referred to as which one of the following?

• A)bull call spread
• B)butterfly spread
• C)split
• D)combination
• E)counteraction

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Definitions:

Contribution Rate

The contribution margin expressed as a percentage of the unit selling price.

Fixed Costs

Expenses that do not change with the volume of production or sales, such as rent or salaries.

Net Income

The amount of money left after subtracting all expenses, taxes, and costs from total revenue.

Variable Cost

A cost that varies depending on the level of output or activity, such as materials or labor costs in manufacturing.