The Buyer of a Long Call Option

question 75

Multiple Choice

The buyer of a long call option:

• A) has a maximum loss equal to the premium paid.
• B) has a gain equal to but opposite in sign to the writer of the option.
• C) has an unlimited maximum gain potential.
• D) all of the above

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Definitions:

Nicotine

A stimulating and addictive substance found in tobacco products.

Agonist

A chemical or drug that binds to receptors in the brain and causes a reaction similar to that of a naturally occurring neurotransmitter.

Excitatory Signal

A type of neurotransmitter-induced signal in the nervous system that increases the likelihood of a neuron firing an action potential.

Action Potential

A sudden increase and subsequent decrease in the voltage across a cell membrane resulting from the movement of charged particles.