Multiple Choice
Calculate the return on exercising a put option that was purchased for $10, with an exercise price of $85.The stock price at expiration is $81.
A) (60%)
B) 60%
C) 30%
D) (30%) Proceeds = exercise price - stock price
= 85 - 81 = $4
Profits = proceeds - original investment
= 4 - 10 = -$6
Correct Answer:
Verified
Correct Answer:
Verified
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