Which of the Following Statements Is True About Closing a Long

question 53

Multiple Choice

Which of the following statements is true about closing a long call position prior to expiration relative to holding it to expiration?

• A)the profit is greater at all stock prices
• B)the profit is greater only at low stock prices
• C)the profit is greater only at high stock prices
• D)the range of possible profits is greater
• E)none of the above are true

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Definitions:

Error

A discrepancy between a computed or measured value and the true value.

Linear Regression

A statistical method used to model the relationship between a dependent variable and one or more independent variables by fitting a linear equation.

F-Test Statistic

A type of statistical test used to compare the variances of two populations or to test the significance of regression coefficients in a linear regression model.

Sum Of Squares

A statistical technique used to measure the variation or deviation of a set of values from the mean of those values.