Question
Which of the following statements is correct? a. Assume that you own a put option on a stock, and the option matures today. The current
Which of the following statements is correct?
a. | Assume that you own a put option on a stock, and the option matures today. The current stock price is $70, and the exercise price is $60. Then, you exercise the option. | |
b. | Underlying assets of American options are U.S. companies. | |
c. | When a firm is unable to pay off outstanding debt, common stockholders have obligation to pay off the debt on behalf of the firm. | |
d. | You have sold (i.e. written) a call option with the exercise price of $70. The underlying stock price is $100 on the maturity date. You make a profit of $30 from the transaction. | |
e. | European call option is the right to buy a specified asset at a specified price on the maturity date. |
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