You Sell an IBM Call Option for $4

question 17

Multiple Choice

You sell an IBM call option for $4. The strike price of the option is $120, and the maturity is one year. At maturity, the price of the IBM stock is $126. Your profit/loss over the entire transaction is:

• A) $3 profit
• B) $2 loss
• C) $6 loss
• D) $4 profit

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