If the Dollar Appreciates, It Can Be Said That

question 38

Multiple Choice

If the dollar appreciates, it can be said that

• A)foreigners respect the United States more.
• B)it increases in value within the United States.
• C)other currencies depreciate.
• D)it takes more dollars to buy foreign currencies.

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Definitions:

In The Money

A term describing an option contract that would lead to a positive cash flow to the holder if it were exercised immediately.

Underlying Stock Price

The price of the stock that an option gives a holder the right to buy or sell.

Exercise Price

The price at which the holder of an options contract may buy or sell the underlying security.

Call Decreases

The process wherein the value of a call option drops due to factors like a decrease in the price of the underlying asset or closer expiration.