USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)

question 16

Multiple Choice

USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)
On the last day of October, Bruce Springsteen is considering the purchase of 100 shares of Olivia Corporation common stock selling at $37 1/2 per share and is considering an Olivia option.

-Refer to Exhibit 14.1. If Bruce buys a March put option with an exercise price of 40, what is his dollar gain (loss) if he closes his position when the stock is selling at 43 1/2?

• A) $825.00 loss
• B) $475.00 loss
• C) $350.00 loss
• D) $25.00 loss
• E) $50.00 gain

---

Definitions:

Anxiety

An emotion characterized by feelings of tension, worried thoughts, and physical changes like increased blood pressure.

Bulimia Nervosa

A disorder related to eating, marked by periods of excessive food consumption followed by unsuitable weight management techniques, like self-induced vomiting or intense physical activity.

Binge/Purge Cycle

A behavior pattern seen in bulimia nervosa, involving excessive eating followed by efforts to avoid weight gain.

Efficacy

The ability to produce a desired or intended result, often used in the context of medications or treatments.