Which Statement Is True Regarding a Foreign Currency Option

question 66

Multiple Choice

Which statement is true regarding a foreign currency option?

• A) A foreign currency option gives the holder the obligation to buy or sell foreign currency in the future.
• B) A foreign currency option gives the holder the obligation to only sell foreign currency in the future.
• C) A foreign currency option gives the holder the obligation to only buy foreign currency in the future.
• D) A foreign currency option gives the holder the right but not the obligation to buy or sell foreign currency in the future.
• E) A foreign currency option gives the holder the obligation to buy or sell foreign currency in the future at the spot rate on the future date.

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Definitions:

Laissez-faire

An economic theory or policy approach that advocates for minimal government intervention in the free market, allowing businesses and individuals to operate with little regulatory oversight.

Authoritative

A leadership or parenting style characterized by high responsiveness and high demands; promoting independence while maintaining limits.

Pubertal Delay

A condition characterized by a delayed onset of puberty, marked by the absence of developmental changes at the expected age.

Preadolescent Boys

Refers to male children who are in the developmental stage immediately preceding adolescence, typically between the ages of 9 and 12 years old.