Jamie Wrote a Nine-Month Put on Beta Stock

question 109

Multiple Choice

Jamie wrote a nine-month put on Beta stock.The strike price was $25 and the market price at the time the option was written was $24.The total price of the option contract was $150.At what market price will Jamie just break-even on this investment? Ignore transaction costs and taxes.

• A)$23.50
• B)$24.00
• C)$25.00
• D)$26.50

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Definitions:

Beginning Inventory

The estimated financial value of items ready to be sold at the onset of a ledger year.

Balance Sheet

A financial statement that provides a snapshot of a company's financial condition at a specific moment, showing assets, liabilities, and shareholders' equity.

Adjusted Trial Balance

A statement listing all accounts and their balances after adjustments, used to verify the equality of debits and credits before generating financial statements.

Financial Statement Column(s)

Specific sections within financial statements that organize and present data in a structured manner, facilitating analysis and comparison.