multiple choice questions 1. Suppose you invested heavily in XYZ stock. You expe
ID: 2629328 • Letter: M
Question
multiple choice questions
1. Suppose you invested heavily in XYZ stock. You expect its stock price may decline in the near future. Which action will hedge against this price decline risk?
a. Buy call options
b. Buy put options
c. Short call options
d. Short put options
2. The futures price of a contract changes every trading day.
True or False
3. Which option position is associated with an obligation to sell an asset at a specified price?
a. Short call
b. Long call
c. Short put
d. Long put
a. Buy call options
b. Buy put options
c. Short call options
d. Short put options
Explanation / Answer
1
c. Short call options
2
true
3
d. Long put
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