The Purchase of a Currency Put Option Would Be Appropriate

question 115

Multiple Choice

The purchase of a currency put option would be appropriate for which of the following?

• A) Investors who expect to buy a foreign bond in one month.
• B) Corporations who expect to buy foreign currency to finance foreign subsidiaries.
• C) Corporations who expect to collect on a foreign account receivable in one month.
• D) all of the above

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Definitions:

Wage Affected

A phrase indicating how wages can be influenced or modified by various factors such as inflation, demand, or government policy.

Agricultural Products

Goods derived from farming and the cultivation of the land, such as crops, livestock, and raw materials.

Marginal Product

The additional output that results from using one more unit of a particular input, keeping all other inputs constant.

Labor-Supply Curve

A graph that shows the relationship between the wages workers receive and the amount of labor they are willing to supply.