The Period Over Which a Call or Put Option Exists

question 61

Multiple Choice

The period over which a call or put option exists is

• A)determined by its delivery date.
• B)determined by its expiration date.
• C)determined by whether the contract is written for a commodity or for a financial instrument.
• D)indeterminate; options contracts continue in existence until either the buyer or the seller desires to discontinue it.

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Definitions:

Legal Reserves

Legal reserves are funds that financial institutions are required to hold in reserve against deposits made by their customers, as dictated by regulatory authorities.

Vault Cash

Physical money that is held in banks' vaults and ATMs, used to meet the bank's obligations to depositors.

Federal Reserve Bank

One of the 12 regional banks that, together with the Board of Governors, make up the Federal Reserve System, which serves as the central banking system of the United States.

Treasury Notes

Short- to medium-term debt obligations issued by a national government with fixed interest rates and maturities ranging from one to ten years.