Which of the Following Is NOT a Factor in Determining

question 73

Multiple Choice

Which of the following is NOT a factor in determining the premium price of a currency option?

• A) the present spot rate
• B) the time to maturity
• C) the standard deviation of the daily spot price movement
• D) All of the above are factors in determining the premium price.

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Definitions:

Monopolist

An entity that is the sole provider of a particular good or service, allowing it to control market prices.

Total Profit

The overall financial gain made by a business after all expenses have been subtracted from the total revenues.

Demand Elasticities

Measures the responsiveness of demand for a good or service to changes in its price, income levels, or other factors.

Price Discrimination

A pricing strategy where a seller charges different prices for the same product or service to different customers, based on factors like demand, cost of service, or market competition.