A Calendar Spread Requires the Purchase and Sale of Two

question 19

Multiple Choice

A calendar spread requires the purchase and sale of two calls or two puts in the same stock with

• A) the same expiration date but different exercise prices.
• B) the same exercise price but different expiration dates.
• C) different exercise prices and different expiration dates.
• D) the same exercise price and the same expiration month.
• E) traded in different markets.

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Definitions:

Demographic Characteristics

The attributes of a population, such as age, race, income, or education, used in statistics to identify and analyze specific groups.

Normally Distributed

A mirrored probability distribution about the mean, which shows that data points are more frequently found near the mean than at farther distances.

Equal Variances

A condition in which two or more populations have the same variance.

GMAT Scores

Standardized test scores used as a part of the admissions process for graduate management programs like MBA.