A Writer Sells a Covered Call at $3 Per Share

question 45

Multiple Choice

A writer sells a covered call at $3 per share with a strike price of $65. If the stock price rises to $71 at expiration, what is the profit or loss to the writer?

• A) $6
• B) $2
• C) -$2
• D) -$6

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Definitions:

Social Psychologists

Scientists who study how people's thoughts, feelings, and behaviors are influenced by the actual, imagined, or implied presence of others.

Stanley Milgram

A psychologist best known for his research on obedience, demonstrating how people can commit acts against their morals under authority pressure.

Social Psychologist

A professional who studies how individuals think, influence, and relate within societal contexts.

Person-situation Debate

A psychological debate concerning whether a person's behavior is influenced more by their personality or their situational context.