Which of the Following Assumes Higher Stock Prices

question 5

Multiple Choice

Which of the following assumes higher stock prices?
1. buying a stock index call
2. buying a stock index put
3. selling a stock index call
4. selling a stock index put

• A)1 and 3
• B)1 and 4
• C)2 and 3
• D)2 and 4

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Definitions:

Transformational Representation

The cognitive process of representing complex information and structures differently in the mind to facilitate understanding or problem-solving.

Situational Awareness

The perception of the elements in the environment within a volume of time and space, the comprehension of their meaning, and the projection of their future status.

7 ± 2

A theory suggesting that the average person can hold about 7 (plus or minus 2) items in their working memory.

Miller

Refers to George A. Miller, a cognitive psychologist best known for his theory regarding the limit of short-term memory capacity, often summarized as "seven, plus or minus two" pieces of information.