Allison bought 100 shares of MIKO, Inc. stock at a price of $35 a share. In addition, she bought a 35 put on MIKO at a cost of $125. Which of the following are true about Allison's position from now until the option expiration date?
I. Her maximum loss is $3,625.
II. Her maximum loss is $125.
III. Her minimum gain is $125.
IV. Her maximum profit is unlimited.
A) I and IV only
B) II and III only
C) II and IV only
D) II, III and IV only
Answer: C
You might also like to view...
Clanston Corp., a steel manufacturing giant, announces its plans to merge with another steel manufacturing company, Tralesta Corp. Peter is a major stockholder in Clanston Corp., and his experience suggests that the merger is not going to be a profitable one. Which of the following basic shareholder rights must Peter use to express his disapproval of the merger?
A. Trading rights B. Entitlement to a residual claim on assets C. Entitlement to dividends D. Voting rights
If an offeror does not expressly authorize a certain mode of acceptance, then acceptance may be made by any reasonable means.
Answer the following statement true (T) or false (F)
Differential pricing means different buyers pay different prices for the same quality and quantity of a product.
Answer the following statement true (T) or false (F)
The tax result to the corporation is
A corporation has the following capital gains and losses during the current year:
A) deduct $3,000 of the STCL currently; carry forward the remaining $2,000 STCL and $6,000 LTCL.
B) deduct $5,000 STCL and $6,000 LTCL.
C) deduct nothing currently; carry back the $5,000 STCL and $6,000 LTCL for three years and carry forward for 5 years, if necessary.
D) deduct nothing currently; carry back the $11,000 STCL for three years and carry forward for 5 years, if necessary.