- CFA Exams
- CFA Level I Exam
- Topic 7. Derivatives
- Learning Module 2. Forward Commitment and Contingent Claim Features and Instruments
- Subject 2. Contingent Claims: Options
CFA Practice Question
If an option is quoted at $14 per share, what must one pay for the option contract?
B. $700
C. $1,400
A. $140
B. $700
C. $1,400
Correct Answer: C
A contract is for 100 shares.
User Contributed Comments 7
| User | Comment |
|---|---|
| shasha | the "rule" 100 shares per contract is for all kinds of derivatives, isn't it? |
| billou | no |
| stefdunk | an oil futures contract is a derivative, and no shares are involved whatsoever |
| anricus | Is a share option always for 100 shares? What about other key commodities? Is it necessary to know the quantity? And indexes? |
| bobert | Option contracts that are exchange traded are good for 100 shares. |
| gazza77 | Australian ETO's are 1000 shares/contract |
| ankurwa10 | this question is good for knowledge but i highly doubt if on standalone basis, it requires conceptual understanding. it is factual. |