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21.
Latetia owns a convertible bond. Which one of the following terms would
describe the value of this bond if it were not convertible?
22.
Brad owns a convertible bond. Which one of the following terms would
apply to the value of this bond if he were to convert it into shares of stock
today?
23.
Which one of the following statements correctly describes your situation as
the holder of a European call option?
24.
Julie opted to exercise her August option on June 20th and as a result
received $2,500 for the sale of her shares. Which one of the following did
Julie own?
25.
Josh opted to exercise his January option at the end of December and paid
$3,250 at that time to acquire 100 shares of stock. Which one of the
following did Josh own?
26.
Steve owns an option which grants him the right to purchase shares of
Lokier Tool stock at a price of $45 a share. Currently, the stock is selling for
$52.40 a share. Steve would like to realize his profits but is not permitted to
exercise the option for another two weeks. Which one of the following does
Steve own?
27.
What is the primary difference between an American call option and a
European call option?
28.
You own a July $15 call on ABC stock. Assume today is April 20 and the call
has zero intrinsic value. Which one of the following best describes this
option?
29.
A $20 put option on Wildwood stock expires today. The current price of the
stock is $18.50. Which one of the following best describes this option?
30.
Which one of the following describes the maximum value of a call option?
31.
Which one of the following describes the lower bound of a call's value?
32.
Which one of the following describes the intrinsic value of a call option?
33.
Which one of the following describes the intrinsic value of a put option?
34.
Which one of the following statements is correct?
35.
An increase in which of the following will increase the value of a call?
I. time to expiration
II. underlying stock price
III. risk-free rate of return
IV. price volatility of the underlying stock
36.
Which of the following will decrease the value of a call option?
I. a decrease in the exercise price
II. a decrease in the value of the underlying security
III. an increase in the risk-free rate
IV. an increase in the time to expiration
37.
Mark owns both a March $20 put and a March $20 call on Alpha stock.
Which one of the following statements correctly relates to Mark's position?
Ignore taxes and transaction costs.
38.
Travis owns both a September $30 call and a September $30 put. If the call
finishes at-the-money, then the put will:
39.
Which one of the following statements regarding employee stock options
(ESOs) is correct?
40.
Employee stock options are primarily designed to do which one of the
following?
