SIE Exam Lesson 11 Options pt 1 Quiz - a podcast by Franz

SIE Exam Lesson 11 Options pt 1 Quiz
SIE Exam Lesson 11 Options pt 1 QuizThis is a SIE Exam Lesson 11 Quiz  options pt.1which is covering options pt. 1 basic option terminology of call and put options See how you do if you need help listen to the lesson over.

Questions covered includeBelow are questions based on the previous lesson. Choose the letter of the correct answer.
To take the quiz online, click here.Quiz Options Part 1

1. The oldest recorded option was about _____ getting options on the use of olive presses for a small price and charging olive growers exorbitant price for the use of those olive presses.A. Nassim Taleb
B. Parmenides of EleaC. Pythagoras
D. Thales of Miletus2. It gives the holder or buyer of the option the right to purchase a specific number of shares of stock.
A. call optionB. order option
C. purchase optionD. put option

3. All of the following are needed in evaluating the value of an option EXCEPT ___.A. expiration date of the option
B. interest rateC. stock price
D. strike price4. The premium is the price paid for an option.
A. TrueB. False

5. Brokerage firms require same-day settlement on the options that are bought from them.A. True
B. False6. In a call option, it is the price at which the stock can be bought.
A. option priceB. option rate
C. stock priceD. strike price

7. Which of the following makes a call option valuable?A. when the stock price is greater than the strike price after the expiration of the option
B. when the stock price is greater than the strike price before the expiration of the optionC. when the strike price is greater than the stock price after the expiration of the option
D. when the strike price is greater than the stock price before the expiration of the option8. The more time you have on the option, the more expensive the option becomes.
A. TrueB. False

9. In the “in the money option”, the strike price is above the current stock price.A. True
B. False10. It is the difference between the strike price and the current stock price when the strike price is lower than the current stock price.
A. absolute valueB. intrinsic value
C. option valueD. par value

SIE Exam Lesson 11 Options pt 1: Cont11. If the stock price increases before the option expires, the intrinsic value of the option ___.
A. decreasesB. increases
C. remains constantD. There is no direct relationship between the stock price and the intrinsic value of the option.

12. It is the price paid over the intrinsic value for the time period of the option.A. premium value
B. premium intrinsic valueC. settlement value
D. time value13. When the time value of the option declines to zero, what is left to the option at the time of expiration is its ___.
A. intrinsic valueB. par value
C. strike valueD. The time value will never decline to zero.

14. It is the right to sell the stock at a specific price.A. call feature
B. call optionC. put feature
D. put option15. In a put option, it is the price at which the stock can be sold.
A. option priceB. option rate
C. stock priceD. strike price

16. If the current price of the stock in the market is $60 and it was offered in a call option at a strike price is $50, what is the intrinsic value of the option?A. $10
B. $110C. $5
D. $5517. An option that has expired loses its intrinsic value.
A. TrueB. False

18. If you bought a call option at a premium of $18 to buy a stock at $50 that is now selling in the market at $60, how much did you pay for the time value?A. $10
B. $18C. $8
D. $919. If the current price of the stock in the market is $60 and the strike price is $50 in a put option, what is the intrinsic value of the put option?
A. $5B. $10
C. $55D. The put option has no intrinsic value.

20. What value does an out of the money put option has?A. intrinsic value only
B. time value onlyC.

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