The Promise or Order in an Instrument Must Be to Pay

question 22

Multiple Choice

The promise or order in an instrument must be to pay:

• A)a fixed amount of money.
• B)an undefined amount of money.
• C)an amount of money subject to a condition subsequent.
• D)the equivalent of the amount specified in any medium on demand.

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Definitions:

Strike Price

The price at which an options contract can be exercised, essentially the price at which the underlying asset can be bought or sold.

Soybeans

A type of legume native to East Asia, widely grown for its edible bean which has numerous uses.

Expiration Date

The specified date on which the options contract or other financial instrument becomes void and ceases to exist.

Marking-To-Market

The process of updating the value of an asset or liability to reflect its current market value rather than its book value.