If You Consider the Equity of a fiRm to Be

question 262

Multiple Choice

If you consider the equity of a firm to be an option on the firm's assets then the act of paying off debt is comparable to _____ on the assets of the firm.

• A) purchasing a put option
• B) purchasing a call option
• C) exercising an in-the-money put option
• D) exercising an in-the-money call option
• E) selling a call option

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Definitions:

Tay-Sachs Disease

A genetic disorder caused by the absence of a specific enzyme, leading to the accumulation of fatty substances in the brain and nervous system, resulting in deterioration and death.

Genetic Testing

The analysis of DNA, RNA, chromosomes, proteins, and certain metabolites in order to detect heritable disease-related genotypes, mutations, phenotypes, or karyotypes for clinical purposes.

Carriers

Individuals or organisms that have one copy of a recessive gene for a genetic trait or disease but do not exhibit the trait or disease themselves.

Reciprocal Translocations

A chromosome abnormality caused by exchange of segments between non-homologous chromosomes.