If the investor buys a bull spread, the individual
Anticipates

Name: If the investor buys a bull spread, the individual Anticipates
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Question

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Bull spreads involve buying a call at a lower strike price and selling a call at a higher strike price. This strategy is profitable when the stock price increases because the profit from the higher strike call offsets the cost of the lower strike call. Therefore, the investor anticipates higher stock prices.

If the Investor Buys a Bull Spread, the Individual