You Own Stock in a Firm That Has a Pure

question 4

Multiple Choice

You own stock in a firm that has a pure discount loan due in six months.The loan has a face value of $50,000.The assets of the firm are currently worth $62,000.The stockholders in this firm basically own a ________ option on the assets of the firm with a strike price of ________

• A)put; $62,000.
• B)put; $50,000.
• C)warrant; $62,000.
• D)call; $62,000.
• E)call; $50,000.

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