Suppose That a Stock Sells at a Price of $60

question 53

Multiple Choice

Suppose that a stock sells at a price of $60 on the expiration date. Compute the payoff to the seller of a call option if the option strike price is $20.

• A) -$20
• B) -$30
• C) -$40
• D) -$50

---

Definitions:

Intermediary

An entity or person who acts as a mediator or link between two parties in a financial transaction or process.

Global Market Entry

Strategies used by companies to enter into new international markets, involving consideration of factors like regulations, competition, and cultural differences.

Exporting

The selling of goods or services produced in one country to buyers in another country.

Direct Investment

An investment involving the purchase of the physical assets or a significant amount of ownership (stock) of a company in another country.