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Owning a Call Option That Has a High Probability of Being

Question 6

Multiple Choice

Owning a call option that has a high probability of being exercised is said to be equivalent to owning the stock.In which way is owning a call not equivalent to owning the stock?


A) Option holders pay no income taxes.
B) Shareholders do not have capped (restricted) profits.
C) Option holders do not receive dividends.
D) Shareholders cannot sustain losses.

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