The bid-ask spread for a given option series refers to the difference between the best bid quote and the best ask quote. Why is it considered a transactions cost? (Assume that the best ask quote is greater than the best bid quote, so that the spread is positive.)

Consider an exchange traded put option with an underlying asset of 100 shares of Intel common stock and a strike price of $30 per share. Intel announces a three-for-one stock split prior to the option expiration. After the stock split, what is the new strike price on this contract?

Which of the following events for the common stock of a given company lead to changes in the contract terms for exchange listed options contracts?

Corporations sometimes write stock options on its own common stock. Which of the following is one of these types of stock options? More than one answer may be correct. For full credit, you must select all of the correct answers and none of the incorrect answers.

Under what circumstances does the buyer of an exchange-listed put option pay a brokerage commission? More than one answer may be correct. For full credit, you must select all of the correct answers and none of the incorrect answers.

Under what circumstances does the buyer of an exchange-listed call option pay a brokerage commission? More than one answer may be correct. For full credit, you must select all of the correct answers and none of the incorrect answers.

When a stock goes ex-dividend, the share price drops by the amount of the upcoming dividend, all else equal. How does this event affect premiums on exchange-listed put options on the stock?

An options series consists of…

Which of the following is NOT a method used by the Options Clearing Corporation (OCC) to reduce risk of default in the options markets?

At an options exchange, a position limit… More than one answer may be correct. For full credit, you must select all of the correct answers and none of the incorrect answers.