Assume That You Purchased Shares of a Stock at a Price

question 58

Multiple Choice

Assume that you purchased shares of a stock at a price of $35 per share.At this time you purchased a put option with a $35 strike price of $3.The stock currently trades at $40.Calculate the dollar return on this option strategy.

• A) $3
• B) -$2
• C) $2
• D) -$3
• E) $0

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Definitions:

Superego

The part of the personality in Freudian psychoanalysis that is responsible for upholding moral standards and ideals acquired from parents and society, often in conflict with individual desires.

Conservative

A philosophical or political stance that emphasizes traditional values, stability, and resistance to change.

Projection

A defense mechanism where an individual ascribes their own unacceptable thoughts, feelings, or motives to another person.

Repression

A defense mechanism where unpleasant thoughts, memories, or desires are excluded from conscious awareness.