Figure 1 depicts the
A)position diagram for the buyer of a call option.
B)profit diagram for the buyer of a call option.
C)position diagram for the buyer of a put option.
D)profit diagram for the buyer of a put option.

Question

Figure 1 depicts the 
A)position diagram for the buyer of a call option. 
B)profit diagram for the buyer of a call option. 
C)position diagram for the buyer of a put option. 
D)profit diagram for the buyer of a put option.

Quizplus · Accepted Answer

The diagram depicts a profit diagram for the buyer of a call option. This can be determined by observing the upward sloping line representing profit on the y-axis as the underlying asset price increases on the x-axis.

Figure 1 Depicts the