A Put Option on a Stock Has an Exercise Price

question 85

Multiple Choice

A put option on a stock has an exercise price of $74.If the stock price at expiration is $79,what is the option payoff for a long put position?

• A)$0
• B)$5
• C)-$5
• D)$79
• E)-$79

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Definitions:

Exculpatory Clause

A provision in a contract that absolves one party from liability for their own negligence or wrongdoing.

Liability

Obligation or liability for one's actions or debts.

Tortious Conduct

Actions carried out by an individual or entity that cause harm or loss to another, leading to civil legal liability.

Public Officer

An individual holding a position of authority in a governmental organization, bound by official duties.