You Can Hedge Against an Increase in Interest Rates by Buying

question 141

Multiple Choice

You can hedge against an increase in interest rates by buying a ____ option on a bond or by buying _____ option on interest rates.

• A) call; a call
• B) call; a put
• C) put; a call
• D) put; a put
• E) call; either a call or put

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Definitions:

Organizational Process

The structured set of activities and tasks that an organization uses to coordinate work operations and achieve its objectives.

Knowledge Sharing

The process by which individuals exchange information, skills, or expertise in a way that benefits the organization or community.

Measures Performance

The process of evaluating the efficiency and effectiveness of actions or operations, typically through quantitative metrics.

Flexible Budget

A budget that is stated as a function of some volume measure, such as units produced. Flexible budgets adjust for changes in volume.