Writer sells put option with strike price

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Reference no: EM131622421

1- If a writer sells a put option with a strike price of $70 at $3 per share, what is her net profit or loss if the underlying stock at expiration is selling at $72?

a. $5 per share

b. $3 per share

c. $1 per share

d. -$5 per share

2-You buy 500 shares of BHC stock at $80 a share on margin. The initial margin is 50% and the maintenance margin requirement is 30%. If the stock price drops to $60, what will be the actual margin in your account?

a. 67%

b. 50%

c. 33%

d. 25%

Reference no: EM131622421

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