Anthony Is Confident That Shares of SolarTech Will Greatly Increase

question 44

Multiple Choice

Anthony is confident that shares of SolarTech will greatly increase in value, but thinks that it may be a year or more before that happens. He should buy

• A) ETF calls.
• B) LEAP puts.
• C) LEAP calls.
• D) Index calls.

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Definitions:

Monopoly Power

The ability of a firm or entity to control or dominate an industry or sector, enabling it to set prices above competitors without losing significant market share.

Brand Loyalty

The tendency of consumers to continuously purchase one brand's products over competing brands due to perceived satisfaction and quality.

Economic Efficiency

A condition where resources are allocated in a way that maximizes the net benefit to society, meaning no one can be made better off without making someone else worse off.

Economies of Scale

Cost benefits acquired by businesses due to the size of their operations, which causes a decrease in the cost per output unit as the operation's scale increases.