The Probability of Two Independent Events Occurring Together Is Called

question 9

Multiple Choice

The probability of two independent events occurring together is called a __________ probability, while the probability of an event occurring given that another event has occurred is called a __________ probability.

• A) joint…..conditional
• B) conditional…..joint
• C) multiple outcome…..single outcome
• D) single outcome…..multiple outcome
• E) None of the above

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Definitions:

Stock Option

A financial derivative that gives the holder the right, but not the obligation, to buy or sell a stock at a predetermined price within a specific time period.

Expected Rate of Return

The anticipated yield or gain that an investor expects to earn on an investment, based on past or projected future performance.

Premium

The amount by which the price of something, especially a financial asset, exceeds its nominal or face value.

Strike Price

The fixed price at which the holder of an option can buy (in the case of a call) or sell (in the case of a put) the underlying security or commodity.