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You Form a Long Option Straddle (A Combination of a Long

question 26

Multiple Choice

You form a long option straddle (a combination of a long call and a long put with the same exercise price) on the Mexican peso. Which of a) through c) results in a profit on your position?


Definitions:

Isostasy

The equilibrium state of the Earth’s crust, where the forces pushing a land mass up are balanced by the weight of the mass itself pressing down.

Equanimity

A state of mental or emotional stability, especially in difficult situations.

Superposition

A principle in geology stating that in an undisturbed sequence of rocks, layers are older at the bottom and younger at the top.

Regional Elevations

The varying heights of the Earth's surface in a specific area, measured relative to sea level.

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