Exam 20: Options Markets: Introduction

You purchased a call option for $3.45 17 days ago.The call has a strike price of $45 and the stock is now trading for $51.If you exercise the call today, what will be your holding period return If you do not exercise the call today and it expires, what will be your holding period return

Suppose you purchase one WFM May 100 call contract at $5 and write one WFM May 105 call contract at $2. What is the lowest stock price at which you can break even

An American call option allows the buyer to

Asian options differ from American and European options in that

You purchase one September 50 put contract for a put premium of $2.What is the maximum profit that you could gain from this strategy

Consider a one-year maturity call option and a one-year put option on the same stock, both with striking price $100.If the risk-free rate is 5%, the stock price is $103, and the put sells for $7.50, what should be the price of the call

The price that the writer of a put option receives for the underlying asset if the option is exercised is called the

The value of a stock put option is positively related to

You purchased one AT&T March 50 call and sold one AT&T March 55 call.Your strategy is known as

Which of the following factors affect the price of a stock option

The maximum loss a buyer of a stock put option can suffer is equal to

The current market price of a share of CAT stock is $76.If a put option on this stock has a strike price of $80, the put

The current market price of a share of a stock is $80.If a put option on this stock has a strike price of $75, the put

What happens to an option if the underlying stock has a 2-for-1 split

List three types of exotic options and describe their characteristics.

Suppose that you purchased a call option on the S&P 100 Index.The option has an exercise price of 1,700 and the index is now at 1,760.What will happen when you exercise the option

The current market price of a share of Boeing stock is $75.If a put option on this stock has a strike price of $70, the put

ING Stock currently sells for $38.A one-year call option with strike price of $45 sells for $9, and the risk-free interest rate is 4%.What is the price of a one-year put with strike price of $45

You purchase one IBM 200 call option for a premium of $6.Ignoring transaction costs, the break-even price of the position is

The price that the buyer of a put option receives for the underlying asset if she executes her option is called the