Disregarding transaction costs

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Reference no: EM131350596

1. Disregarding transaction costs, if a put buyer breaks even, the put writer _______.

a. also breaks even

b. does not receive the premium

c. has a gain

d. has a loss

e. does not have to honor the request to exercise a put

2. A seller of a call option on a stock expects _______.

a. the stock price to rise above the exercise price

b. the stock price not to rise above the exercise price

c. the stock price not to fall below the exercise price

d. the counterparty not to exercise an in-the-money call

e. none of the above

Reference no: EM131350596

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