A Movement Along the Demand Curve to the Right May

question 261

Multiple Choice

A movement along the demand curve to the right may be caused by a(n)

• A) decrease in income.
• B) increase in supply.
• C) fall in the number of substitute goods.
• D) rise in the price of inputs.

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Definitions:

Gamma

The curvature of an option pricing function (as a function of the value of the underlying asset).

Option Price

The price at which the holder of an options contract can buy (in the case of a call option) or sell (in the case of a put option) the underlying asset or security.

Hedge Ratio

A ratio used in hedging that compares the value of a position protected through a hedge with the size of the entire position itself.

Stock Price

The cost of purchasing a share of a company, reflecting the value of the company as determined by the supply and demand in the stock market.