The Shorter the Time to the Expiration Date for a Currency

question 27

Multiple Choice

The shorter the time to the expiration date for a currency, the ____ will be the premium of a call option, and the ____ will be the premium of a put option, other things equal.

• A) greater; greater
• B) greater; lower
• C) lower; lower
• D) lower; greater

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Definitions:

Collapse

The sudden failure or downfall of an institution, structure, or system, whether economic, social, political, or environmental, often leading to a significant change or restructuring.

Edict Of Nantes

A 1598 decree issued by King Henry IV of France, granting substantial religious freedoms to French Protestants (Huguenots) and bringing an end to the Wars of Religion.

Huguenots

Members of the French Protestant group that faced severe persecution in the 16th and 17th centuries, leading many to flee France for other countries.

New France

The area colonized by France in North America from the 16th to the 18th century, including parts of contemporary Canada, the United States, and several Caribbean islands.