The Authorization of Common Shares

question 114

Multiple Choice

The authorization of common shares

• A) must be approved by Canada Revenue Agency.
• B) does not require a journal entry.
• C) increases shareholders' equity.
• D) decreases shareholders' equity.

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Definitions:

Stock-Index Option Markets

Marketplaces where options based on the movements of stock market indices are traded, allowing investors to speculate or hedge against market swings.

Uncovered Call Option

An option contract that is sold without holding an offsetting position in the underlier, thus exposing the seller to unlimited risk.

Uncovered Put Option

A type of options strategy where the seller of the put option does not have a sufficient position in the underlying asset, exposing them to potentially unlimited losses.

Digital Option

A financial instrument that provides a fixed return if the market price is above (for a call) or below (for a put) a certain level at expiration.