USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)

question 99

Multiple Choice

USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)

-Refer to Exhibit 16.1. If the spot rate at expiration is $0.80 and the call option was purchased, what is the dollar gain or loss?

• A) $123 gain
• B) $590 loss
• C) $312 gain
• D) $237 gain
• E) $0

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Definitions:

Ionic Bonds

Ionic bonds are chemical bonds formed between two atoms when one atom transfers electrons to another, resulting in oppositely charged ions that attract each other.

Covalent Bonds

Covalent bonds are chemical bonds where atoms share pairs of electrons, enabling each atom to attain a stable electron configuration.

Outermost Shell

In chemistry, refers to the valence shell, which is the outermost shell of electrons in an atom and determines an element's chemical properties.

Positively Charged

Having a net electric charge due to the loss of electrons.