AFP
CTP · Question #42
(Topic 1) A put option on a company's stock has an exercise price of $20. On the delivery date, the stock is trading at $24 per share. What should the investor who has paid $2 for the option do?
The correct answer is A. Not exercise the option and lose $2. See the full explanation below for the reasoning.
Question
- (Topic 1)
A put option on a company's stock has an exercise price of $20. On the delivery date, the stock is trading at $24 per share. What should the investor who has paid $2 for the option do?
Options
- ANot exercise the option and lose $2.
- BNot exercise the option and lose $6.
- CExercise the option and gain $2.
- DExercise the option and gain $4.
How the community answered
(43 responses)- A72% (31)
- B7% (3)
- C16% (7)
- D5% (2)
Community Discussion
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