When does it make financial sense to buy a call option?

When you expect the underlying price to decrease When you expect the underlying price to remain flat When you expect the underlying price to increase When you are unsure about the future price movement

What is the maximum potential loss for a call option buyer?

The strike price The spot price The premium paid Unlimited

What happens to a call option buyer's investment if the underlying price goes down?

They make a profit They break even They lose money The outcome is unpredictable

How is the intrinsic value (IV) of a call option upon expiry calculated?

Strike Price - Spot Price Premium Paid - Spot Price Spot Price - Strike Price Spot Price + Premium Paid

What is the breakeven point for a call option buyer?

The strike price The spot price at which the option becomes profitable The premium paid The point at which the buyer recovers the premium paid

What is the profit potential for a call option buyer?

Limited to the premium paid Limited to the strike price Unlimited Dependent on the spot price at expiry

When does a call option buyer start making a profit?

When the spot price is above the strike price When the spot price is below the strike price When the spot price is at the breakeven point When the spot price is above the breakeven point