The writer of a call option hopes that the stock price will:
A) decrease.
B) increase.
C) split.
D) produce quarterly cash dividends.

Name: The writer of a call option hopes that the stock price will: A) decrease. B) increase. C) split. D) produce quarterly cash dividends.
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Question

Quizplus · Accepted Answer

The writer of a call option benefits if the stock price decreases, as this makes it less likely that the option will be exercised, allowing them to keep the premium received without having to sell the stock at a lower price.

The Writer of a Call Option Hopes That the Stock