An Agreement Where a Large Number of Developed Counties Permit

question 4

Multiple Choice

An agreement where a large number of developed counties permit duty-free imports of a selected list of products that originate from specific countries is known as _____.

• A) a custom duty
• B) an ad valorem agreement
• C) an export agreement
• D) the generalized system of preferences
• E) an import agreement

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Definitions:

Real Option

The opportunity to undertake certain business initiatives, such as deferring, abandoning, expanding, or contracting a project, based on future events.

Underlying Asset

A financial asset or instrument upon which a derivative’s price is based, including stocks, bonds, commodities, or currencies.

Call Option

A financial contract that gives the holder the right, but not the obligation, to buy a stock or other asset at a specified price within a certain period.

Put Option

A financial contract giving the option buyer the right, but not the obligation, to sell a specified amount of an underlying asset at a set price within a specified timeframe.