Which of the Following Is NOT True Regarding Options and Options

question 10

Multiple Choice

Which of the following is NOT true regarding options and options on futures contracts?

• A)The purchaser of both an option and an option on futures must pay a premium.
• B)Options are available on stock indexes, but not on stock index futures.
• C)The fulfillment of options on futures contracts is regulated by exchanges, while the fulfillment of options is not.
• D)Options are available on stock indexes, but not on stock index futures AND t he fulfillment of options on futures contracts is regulated by exchanges, while the fulfillment of options is not.

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Definitions:

Fair Value

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

Carrying Amount

The amount at which an asset or liability is recognized in the balance sheet after deducting accumulated depreciation, impairment, and amortization.

Building

A structure with walls and a roof, such as a house or factory, intended for use or occupancy.

AASB 11

An accounting standard that sets out the financial reporting requirements for entities that have an interest in arrangements that are controlled jointly (joint arrangements).