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Assume that you purchased 1 share of a stock at a price of $20 per share. At this time, you wrote a call option with

Assume that you purchased 1 share of a stock at a price of $20 per share. At this time, you wrote a call option with a $20 strike and received a call price of $2. If the stock trades at $40 at expiration, calculate the dollar gain or loss on this investment strategy.

a. $18 gain

b. $18 loss

c. $2 gain

d. $2 loss

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Smith and Roberson Business Law

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