The September 14,2009 price quotation for a Boeing call option with a strike price of $50 due to expire in November is $3.50 while the stock price of Boeing is $51.The premium on one Boeing November 50 call contract is _________.
A) $1
B) $2.50
C) $250.00
D) $350.00

Question

Quizplus · Accepted Answer

The premium on a call option is the price of the option multiplied by the number of shares in the contract. Since the option price is $3.50 and a standard contract covers 100 shares, the premium is $3.50 x 100 = $350.00.

The September 14,2009 Price Quotation for a Boeing Call Option