Which of the Following Best Describes Galt's Debt Using a Put

question 18

Multiple Choice

Which of the following best describes Galt's debt using a put option?

• A)Long $200 million in risk free debt and Short a put option on the firm's assets with a $200 strike price
• B)Short $200 million in risk free debt and Long a put option on the firm's assets with a $200 strike price
• C)Long $200 million in risk free debt and Short a put option on the firm's assets with a $700 strike price
• D)Short $200 million in risk free debt and Long a put option on the firm's assets with a $700 strike price

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Definitions:

Convicted

Found guilty of a criminal offense by a court of law.

Arrested

The act of detaining a person, typically by legal authority, on suspicion of them having committed a criminal offense.

Crime

An act or omission in violation of a law prohibiting it and for which a punishment is imposed upon conviction.

Statutory Rape

is a criminal offense involving sexual activity with a person who is below the legal age of consent, as defined by statute.