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You Purchased Two Call Option Contracts with a Strike Price

question 89

Multiple Choice

You purchased two call option contracts with a strike price of $22.50 and a premium of $2.80. At expiration, the stock was selling for $28.10 a share. What is the total amount it cost you to acquire your shares?


Definitions:

Equity Multiplier

A financial ratio that measures the proportion of a company's total assets financed by its shareholders' equity.

Return On Equity

Return on Equity (ROE) measures a company's profitability by calculating how much profit a company generates with the money shareholders have invested.

Total Asset Turnover

A financial ratio that measures how efficiently a company uses its total assets to generate sales revenue.

Total Assets

The sum of all assets owned by an entity, including both current and non-current assets, reflecting the total resources at its disposal.

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