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"A customer holds the following positions:
Short 100 XYZ shares at 40
Short 1 XYZ Oct 40 put at 5
With XYZ trading at 35, the customer is assigned an exercise notice on the put, and he uses the stock purchased to cover the short stock position. This results in
A)a $500 gain.
B)a $500 loss.
C)a $1,000 loss.
D)a $1,000 gain."

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