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Suppose that today you write an American call option contact (each contract is for 100 shares) on Tesla Inc. (Ticker: TSLA) with a December expiration

Suppose that today you write an American call option contact (each contract is for 100 shares) on Tesla Inc. (Ticker: TSLA) with a December expiration with an exercise price of $200.00 for a premium of $5.00. You hold the option until the expiration date, when TSLA stock sells for $210.00 per share. IF THE OPTION HOLDER WERE A RATIONAL INVESTOR, you (as the option writer) would realize a ___ on the investment.

  1. $1,000 profit
  2. $500 profit
  3. $500 loss
  4. None of the options are correct
  5. $1,000 loss

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