You currently own stock in Wayne Enterprises. You are worried that the stock will fall in...

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You currently own stock in Wayne Enterprises. You are worried that the stock will fall in the near term due to risky lifestyl

business finance

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Answer 1

Answer #1

C. Purchase a put

Purchasing of put will result in a positive payoff if the stock price ends up below the strike price at maturity

A is incorrect as writing a put has a negative payoff if the stock price falls.

D is incorrect as purchasing a call has a 0 payoff if the stock price falls below the strike price.

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Answer 2

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