A Covered Call Writer Who Prefers Even Less Risk Should

question 17

Multiple Choice

A covered call writer who prefers even less risk should

• A)get rid of the call
• B)switch to a call with a lower exercise price
• C)get rid of the stock
• D)switch to a call with a higher exercise price
• E)none of the above

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Definitions:

Functionalist

Pertaining to a theoretical perspective in sociology that views society as a complex system whose parts work together to promote stability and harmony.

Article 2

The section of the Uniform Commercial Code (UCC) that governs the sale of goods in the United States.

Common Law

A legal system based on customs, traditions, and judicial decisions or precedents, rather than on codified written laws.

Consideration

Something of value exchanged between parties in a contract, making the agreement legally binding.