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Three Months Ago,Central Supply Stock Was Selling for $51

Question 67

Multiple Choice

Three months ago,Central Supply stock was selling for $51.40 a share.At that time,you purchased five put options on the stock with a strike price of $52 per share and an option price of $0.60 per share.The option expires today when the value of the stock is $42.70 per share.What is your net profit or loss on this investment? Ignore trading costs and taxes.


A) -$1,300
B) -$1,000
C) -$300
D) $4,350
E) $4,650

Correct Answer:

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