Answer:
The trader exercises the option and loses money on the trade if the stock price is between $30 and $33 at option maturity.
Explanation:
A call option is the right to buy an asset at an agreed price on the maturity date. This agreed price is known as the strike price.
In the given scenario, the strike price is $30. The trader pays an additional $3 for the right to exercise the option, thus paying a total of $33 for the option.
Now, if the asset price on maturity date is greater than $30, the trader shall exercise the option and buy the asset. This is because the market price of the asset is greater than the price the trader pays for it, resulting in a favorable situation for the trader.
However, the trader paid a total of $33 for the stock. Hence, the trader shall lose money on the trade as long as the asset price is below $33.
Therefore, if the asset price upon maturity is between $30 and $33, the trader shall exercise the option but lose money on the trade.
The thing that happens when a bank is required to hold more money in reserve is It has less money for loans.
<h3>What happens when reserve requirements are increased?</h3>
Banks are known to often hold a lot of reserves if reserve requirements are increased.
This is because it is one that they can be able to use if they want to loan out less of each dollar that is said to be deposited. By raising the the reserve ratio, and also lowers the money multiplier, and lowering the money supply.
Therefore, The thing that happens when a bank is required to hold more money in reserve is It has less money for loans.
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<span>If they make, for example 20,000 products every year their variable cost and and fixed cost will be changed because of the increased sales by 20% and they will only lose smaller amount of money than the last year.</span>
