Suppose You Bought 10 Smith Enterprise Call Options with a Strike

question 57

Multiple Choice

Suppose you bought 10 Smith Enterprise call options with a strike price of $52 at $2.75 per option.If the price of Smith stock is $50,what is your net profit (or loss) ? Ignore transaction costs.

• A) $0
• B) -$27.50
• C) $27.50
• D) $500

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Definitions:

Vestibular Sense

The sense of body movement and position, including the sense of balance.

Inner Ear

The innermost part of the ear, containing the cochlea, vestibule, and semicircular canals, crucial for hearing and balance.

Receptors

Specialized cells or proteins in the body that bind to specific molecules like neurotransmitters, hormones, or drugs, triggering a physiological response.

Muscles

Tissues in the body that have the ability to contract, thus enabling movement and support of various body functions.