A Put on United Pipeline Has 1 Year to Maturity

question 19

Multiple Choice

A put on United Pipeline has 1 year to maturity and a strike price of $45.If an investor purchases that option for $3.25 then in order for the investor to break even,United Pipeline's stock price on the expiration date must equal

• A) $45
• B) $48.25
• C) $41.75
• D) none of the above

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Definitions:

Bone

A hard, dense connective tissue that forms the structural elements of the skeleton in vertebrates.

Kidneys

Organs that filter waste products from the blood, regulate blood pressure, and maintain electrolyte balance, among other functions.

Hypothalamus

A region of the brain responsible for hormone production and regulation of vital bodily functions, including temperature, hunger, and thirst.

Oxytocin

A hormone released by the pituitary gland that causes increased contraction of the uterus during labor and stimulates the ejection of milk into the ducts of the breasts.