SIE Understanding Products and Their Risks Practice Question 48

Question: 48

Which of the following is correct regarding all listed options, since are all guaranteed?

A. All obligations of the options contracts are fulfilled.

B. No investor who exercises a contract will ever be "out of the money" for more than the premium paid for the option.

C. Every investor who exercises a contract will be "in the money" or "at the money."

D. No company will be bankrupt on the exercise date of its stock options.