When a Put Futures Is Exercised, the Holder of the Put

question 5

Multiple Choice

When a put futures is exercised, the holder of the put acquires: choose one)

• A) A long position in the futures contract
• B) A short position in the futures contract
• C) A long position in the underlying asset
• D) None of the above

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Definitions:

Operating Activities

Business actions that are directly concerned with the production and delivery of goods and services, typically reflected in the income statement.

Common Stock

A type of equity security that represents ownership in a corporation, granting holders voting rights and a share in the company's profits through dividends.

Statement of Cash Flows

A financial report that provides aggregate data regarding all cash inflows a company receives from its ongoing operations and external investment sources, as well as all cash outflows that pay for business activities and investments during a given period.

Operating Activities

Activities that relate directly to the operations of a company, including cash flows from selling goods and services.