A Stock Currently Sells for £75 Per Share

question 6

Multiple Choice

A stock currently sells for £75 per share. A call option on the stock with an exercise price £70 currently sells for £5.50. The call option is

• A) at-the-money.
• B) in-the-money.
• C) out-of-the-money.
• D) at breakeven.
• E) none of the above.

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Definitions:

Effector

A muscle, gland, or organ that responds to a stimulus from the nervous system by producing a specific effect or action.

Receptor

Structural protein or glycoprotein molecule on the cell surface or within the cytoplasm that binds to a specific factor (chemical signal).

Midline

An imaginary line that divides the body into equal left and right halves.

Lateral

Pertaining to the side, often used to describe relative position or direction in anatomy and medicine.