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

question 46

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 $45 in three months,what will you owe for each share in the contract?

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

Distinguish between normative and positive economic statements.

Recognize the importance and applications of economic analysis for consumers and society.

Understand the concept of "there is no free lunch" in economics.

Grasp the basic principles of macroeconomic analysis and its focus areas.

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Definitions:

Household Debt

The total amount of debt, including mortgages, credit cards, loans, etc., owed by all members of a household.

Macroeconomics

The branch of economics that studies overall economic dynamics such as total output, employment levels, and inflation across an entire economy.

Unemployment Rate

A measure of the percentage of the labor force that is jobless and actively seeking employment.

Growth Rate

The percentage increase in the value of a particular variable (such as GDP, population) over a certain period of time, indicating the rate at which it is expanding or declining.