You Have Shorted a Call Option on WSJ Stock with a Strike

question 45

Multiple Choice

You have shorted a call option on WSJ stock with a strike price of $50.The option will expire in exactly six months.If the stock is trading at $60 in three months,what will you owe for each share in the contract?

• A)$0
• B)$60
• C)$50
• D)$10
• E)$40

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Definitions:

Life Span

The duration or length of life of an individual or organism.

Demand Curve

A graph showing how the quantity of a good or service demanded by consumers changes at different prices.

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Beef

Meat derived from cattle, recognized for its nutritional value and used in various cuisines worldwide.