You Buy a Call Option on Merritt Corp

question 91

Multiple Choice

You buy a call option on Merritt Corp. with an exercise price of $50 and an expiration date in July, and you write a call option on Merritt Corp. with an exercise price of $55 and an expiration date in July. This is called a ________.

• A) time spread
• B) long straddle
• C) short straddle
• D) money spread

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Definitions:

Extrinsic Rewards

Rewards given to employees that are external to the job itself, such as pay, benefits, bonuses, and promotions, aimed at motivating employees' performance.

Internal Promotions

The practice of filling vacancies within an organization by promoting existing employees rather than hiring externally.

Employee Stock Plans

Programs allowing employees to purchase or receive shares in the company they work for, often at advantageous conditions.

Classical Management

A theory of management that emphasizes rationality, efficiency, and a hierarchical structure of control, typically associated with the early 20th century.