Which of the Following Is NOT a Factor in Determining

question 73

Multiple Choice

Which of the following is NOT a factor in determining the premium price of a currency option?

• A) the present spot rate
• B) the time to maturity
• C) the standard deviation of the daily spot price movement
• D) All of the above are factors in determining the premium price.

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Definitions:

Foreign Countries

Nations or territories outside one's own country, often referred to in the context of international trade, travel, or diplomatic relations.

U.S. Investments

Funds or resources allocated by individuals, corporations, or the government within the United States in hopes of generating positive returns or economic growth.

Importer

An individual or organization that buys goods from other countries for resale or use in the domestic market.

Yen Purchase

The act of buying yen, Japan's currency, which can involve exchanging another currency for yen in foreign exchange markets.