You Write One MBI July 120 Call Contract (Equaling 100

question 33

Multiple Choice

You write one MBI July 120 call contract (equaling 100 shares) for a premium of $4. You hold the option until the expiration date, when MBI stock sells for $121 per share. You will realize a ________ on the investment.

• A) $300 profit
• B) $200 loss
• C) $600 loss
• D) $200 profit

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Definitions:

Loan Default

Occurs when a borrower fails to pay back a debt according to the initial agreement.

Financial Ratios

Metrics derived from financial statement analysis used by investors and analysts to evaluate a company's financial health and performance.

Bankruptcy

A legal proceeding involving a person or business that is unable to repay outstanding debts, leading to the liquidation or reorganization of assets under the law.

Operating Cash Flows

This represents the cash generated from a company's normal business operations, highlighting the company's ability to generate sufficient revenue to maintain and grow its operations.