The Value of an Option Is Dependent Upon the Value

question 73

Multiple Choice

The value of an option is dependent upon the value of the underlying security.This relationship defines an option as which one of the following?

• A) equity security
• B) fixed income security
• C) derivative security
• D) transfer security
• E) dependent security

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Definitions:

Logistics

The detailed organization and implementation of a complex operation involving the movement of goods, services, or information from origin to consumption.

Conflicting Business Laws

Situations where different laws or regulations, possibly from different jurisdictions, apply to the same business activity, creating a conflict that businesses must navigate.

Promote Diversification

A strategy aimed at reducing risk by allocating investments among various financial instruments, industries, and other categories.