Use the Table for the Question(s)below

question 5

Multiple Choice

Use the table for the question(s) below.
Consider the following information on options from the CBOE for Merck:
-How many of the January 2009 put options are in the money?

• A)1
• B)3
• C)2

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Definitions:

External Costs

External costs, also known as negative externalities, are the costs experienced by third parties who are not involved in an economic transaction, often not reflected in market transactions.

Market Price

The market price at which you can currently buy or sell a service or asset.

Efficient Equilibrium

A state in an economy where every resource is optimally allocated to serve each individual or entity in the best way while minimizing waste and inefficiency.

External Benefits

Benefits resulting from a transaction that affect parties not directly involved in the transaction, often leading to positive outcomes for society.