Options Sellers Who Are Delta-Hedging Would Most Likely

question 47

Multiple Choice

Options sellers who are delta-hedging would most likely

• A) sell when markets are falling.
• B) buy when markets are rising.
• C) sell when markets are falling and buy when markets are rising.
• D) sell whether markets are falling or rising.
• E) buy whether markets are falling or rising.

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Definitions:

Income Taxes Payable

Represents the amount of taxes on income that a company owes to the government but has not yet paid.

Accounts Payable

Short-term financial obligations to suppliers or creditors for goods and services received but not yet paid for.

Equipment

Tangible assets used in the operation of a business, not intended for sale.

Selling Price

The price at which a product or service is sold to customers, determining the revenue generated from sales activities.