USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)

question 8

Multiple Choice

USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)
Sarah Kling bought a six-month Peppy Cola put option with an exercise price of $55 for a premium of $8.25 when Peppy was selling for $48.00 per share.
-Refer to Exhibit 14.3. If at expiration Peppy is selling for $47.00, what is Sarah's dollar gain or loss?

• A) $25 loss
• B) $250 loss
• C) $25 gain
• D) $250 gain
• E) $0

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Definitions:

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Informal interactions and connections that occur in society outside of formal institutions and structures.

Rosabeth Moss Kanter

An influential American academic specializing in business management practices, particularly around change management and organizational behavior.

Corporation

A legal entity distinct from its owners, with its own rights and obligations, capable of conducting business, owning assets, and incurring liabilities.

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The act of not following or going against the instructions, rules, or commands set by someone in a position of power.