The Rocky Scholes Swimwears warrant is trading for $10. Thewarrant carries the o

The Rocky Scholes Swimwears warrant is trading for $10. Thewarrant carries the option to purchase a half share of common stockfor $40. What is the speculative premium if the stock price is$50?A. $1B. $2.50C. $5D. $10A contract giving the owner the right to buy or sell an asset at afixed price for a given period of time is:A. a common stock.B. an option.C. a futures.D. a capital investmentOptions contracts contrast with futures because:A. options are not traded on organized exchanges.B. options create an obligation for the owner of theinstrument.C. options are derivatives.D. None of the above