An Option Contract Can Be Based on a Foreign Currency

question 35

True/False

An option contract can be based on a foreign currency.

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Definitions:

Demand Uncertainty

This refers to the unpredictability of customer demand for products and services, affecting inventory, production, and distribution planning in supply chains.

Supplier's Demand

The quantity of materials or products required by a supplier from upstream suppliers to meet customer orders or production schedules.

Outsourcing

Outsourcing is the business practice of hiring a party outside a company to perform services or create goods that traditionally were performed in-house by the company's own employees.

Supply Chain Function

A specific activity or set of activities within a supply chain, such as procurement, production, distribution, or logistics, that adds value to products or services.