The Delta of an Option Is Defined As

question 16

Multiple Choice

The Delta of an option is defined as:

• A) expected change in the option premium for a small change in time to expiration.
• B) expected change in the option premium for a small change in volatility.
• C) expected change in the option premium for a small change in the spot rate.
• D) expected change in the option premium for a small change in the domestic interest rate.

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Definitions:

Indirect Method

The indirect method is a way to calculate cash flow from operations by adjusting net income for changes in non-cash accounts and non-operating items.

Journal

The initial record in which the effects of a transaction are recorded.

Free Cash Flow

The cash that a company generates after accounting for cash outflows to support operations and maintain its capital assets.

Financing Activities

Transactions that involve raising funds for the company through borrowing or issuing equity.