# Fight Finance

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Which of the following statements about European call options on non-dividend paying stocks is NOT correct?

Which of the below formulas gives the payoff $(f)$ at maturity $(T)$ from being long a call option? Let the underlying asset price at maturity be $S_T$ and the exercise price be $X_T$.

Which of the below formulas gives the payoff $(f)$ at maturity $(T)$ from being short a call option? Let the underlying asset price at maturity be $S_T$ and the exercise price be $X_T$.

Which of the below formulas gives the payoff $(f)$ at maturity $(T)$ from being long a put option? Let the underlying asset price at maturity be $S_T$ and the exercise price be $X_T$.

Which of the below formulas gives the payoff $(f)$ at maturity $(T)$ from being short a put option? Let the underlying asset price at maturity be $S_T$ and the exercise price be $X_T$.

You just paid $4 for a 3 month European style call option on a stock currently priced at$47 with a strike price of $50. The stock’s next dividend will be$1 in 4 months’ time. Note that the dividend is paid after the option matures. Which of the below statements is NOT correct?

A European call option should only be exercised if: