Question
2.An investor owns 1,000 American Put Options over Telefonicas shares. The strike price is 13.5 per share and the premium paid is 0.75 per option.
2.An investor owns 1,000 American Put Options over Telefonicas shares. The strike price is 13.5 per share and the premium paid is 0.75 per option. Today the quotation of the Telefonicas shares is 10. If the investor decides to exercise the options which is the investors profitability:
a) 466.6%
b) 127.3%
c) 366.6%
d) 1,800.0%
3. The seller of a CALL Option:
a) Has the right to buy the underlying asset
b) Has the obligation to buy the underlying asset if the buyer of the CALL Option wants
c) Has the right to sell the underlying asset
d) Has the obligation to sell the underlying asset if the buyer of the CALL Option wants
4. The buyer of a PUT Option:
a) Has the right to sell the underlying asset
b) Has the obligation to buy the underlying asset if the seller of the Put Option wants.
c) Has the obligation to sell the underlying asset if the seller of the Put Option wants.
d) Has the right to buy the underlying asset.
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