Question
1. On the same day in a cash account, a customer buys 100 shares of PDQ stock at $49 and sells 1 PDQ Jan 50
1. On the same day in a cash account, a customer buys 100 shares of PDQ stock at $49 and sells 1 PDQ Jan 50 Call @ $2. The maximum potential loss is: A $4,700 B $4,900 C $5,100 D unlimited
2. A customer sells short 100 shares of PDQ at $58 and buys 1 PDQ Jul 60 Call @ $3. The breakeven point is: A $55 B $57 C $61 D $64
3.A customer sells 2 ABC Jan 45 Puts @ $5 when the market price of ABC is $44. ABC stock falls to $32 and the customer is assigned. The customer then sells the stock in the market. The loss is: A $1,000 B $1,300 C $1,600 D $2,600
4. What is the "out the money" amount for the following contract? 1 ABC Jan 45 Call @ $4 ABC Market Price = $44 A 0 B 1 C 3 D 4 5. A customer buys 1 ABC Feb 50 Call @ $7 when the market price of ABC is 52. If the market value of ABC falls to $48 and stays there through February, the customer will:
A) gain $700. B) lose $700. C) gain $4,300 D)lose $4,300
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started