KD Industries Stock Is Currently Trading at $32 Per Share

question 51

Multiple Choice

KD Industries stock is currently trading at $32 per share.Consider a put option on KD stock with a strike price of $30.The intrinsic value of this put option is:

• A)$0.
• B)-$2.
• C)$2.
• D)$30.

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Definitions:

Return on Equity

A measure of a corporation's profitability that reveals how much profit a company generates with the money shareholders have invested, expressed as a percentage.

Stockholders' Equity

The residual interest in the assets of a corporation that remains after deducting its liabilities, representing ownership interest in the company.

Gross Margin Percentage

A financial metric indicating the percentage of revenue that exceeds the cost of goods sold, demonstrating the efficiency of a company in managing its production costs relative to sales.

Income Statement

A financial document that shows a company's revenues and expenses over a specified period, illustrating how the net revenue of the company is transformed into net income.