If You Feel Strongly That a Stock Price Will Move

question 11

Multiple Choice

If you feel strongly that a stock price will move, but are unsure of the direction, you could buy the stock and:

• A) buy both a put and a call.
• B) sell both a put and a call.
• C) buy a put and sell a call.
• D)buy two puts.

---

Definitions:

High Inflation

A period characterized by a rapid increase in prices, eroding purchasing power.

Moderate Inflation

A situation where the general price level of goods and services rises at a modest rate over time.

Money Demand

The desired holding of financial assets in the form of cash or bank deposits, often influenced by interest rates and economic conditions.

Liquid Form

Refers to the physical state of a substance that is flowing and has no fixed shape but a definite volume.