A Short Forward Contract on an Asset Plus a Long

question 13

Multiple Choice

A short forward contract on an asset plus a long position in a European call option on the asset with a strike price equal to the forward price is equivalent to

• A) A short position in a call option
• B) A short position in a put option
• C) A long position in a put option
• D) None of the above

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Definitions:

Edema

A medical condition characterized by the accumulation of excess fluid in body tissues, causing swelling.

Morning Sickness

Nausea and vomiting that typically occurs in the early stages of pregnancy, usually in the morning.

Menstrual Period

The monthly shedding of the lining of the uterus (endometrium), leading to bleeding that typically lasts a few days.

Breast Tenderness

The sensation of pain or discomfort in the breasts, which can result from hormonal changes, injury, or medical conditions.