The value of the British pound changed from $1.40 to $1.15. We can say that the pound has ________ and the dollar has ________.

A) depreciated; appreciated

B) appreciated; appreciated

C) appreciated; depreciated

D) depreciated; depreciated

E) None of these choices are correct.

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A contract that gives the holder the right to sell a security at a preset price only immediately before contract expiration is a(n)

A) American call option.

B) European call option.

C) American put option.

D) European put option.

E) knockout option.

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An investor is committed to purchasing 100 shares of World Port Management stock in six months. She is worried the stock price will rise significantly over the next six months. The stock is at $45 and she buys a six-month call with a strike of $50 for $250. At expiration the stock is at $54. What is the net economic gain or loss on the entire stock/option portfolio?