Exhibit 13-10 USE THE FOLLOWING INFORMATION TO ANSWER THE NEXT QUESTION(S)

question 111

Multiple Choice

Exhibit 13-10
USE THE FOLLOWING INFORMATION TO ANSWER THE NEXT QUESTION(S)
GE Corporation has a put option selling for $2.90 and a call option selling for $1.95, both with a strike price of $29.00.
-Refer to Exhibit 13-10. What would the net value of a short straddle position be if the stock price at expiration is $35?

• A) -$36.15
• B) -$7.15
• C) -$1.15
• D) $1.15
• E) $7.15

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Definitions:

Times Interest Earned

A financial ratio that measures a company's ability to meet its interest payments on outstanding debt.

Quick Ratio

A measure of a company's ability to meet its short-term obligations with its most liquid assets, without relying on inventory.

Current Liabilities

Obligations or debts that a company is expected to pay within a year.

Assets

Resources owned or controlled by a business, viewed as providing future economic benefits.