You have shorted a call option on WSJ stock with a strike price of $50.The option will expire in exactly six months.If the stock is trading at $60 in three months,what will you owe for each share in the contract?
A)$0
B)$60
C)$50
D)$10
E)$40

Question

Quizplus · Accepted Answer

When you short a call option and the stock price exceeds the strike price, you owe the difference between the stock price and the strike price. In this case, $60 - $50 = $10 per share.

You Have Shorted a Call Option on WSJ Stock with a Strike