The strike price of an option is:
A. the market price at the time the option is exercised.
B. always above the market price.
C. the price at which the option holder has the right to buy or sell.
D. the market price at the time the option is written.
Answer: C
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To eliminate an inflationary gap, the aggregate demand curve should
a. shift outward. b. become vertical. c. become horizontal. d. shift inward.
The self-correcting tendency of the economy means that rising inflation eventually eliminates:
A. unemployment. B. exogenous spending. C. recessionary gaps. D. expansionary gaps.
Suppose that the economy is currently at full employment. All other things being equal, if central bank implements contractionary policy, then the appropriate fiscal policy is to
A. increase taxes. B. reduce government spending. C. balance the budget. D. increase a budget deficit.
Damian wants to start a business where he is the only owner and the company does not issue stock. The type of business Damian wants to start is a
A) sole proprietorship. B) partnership. C) corporation. D) Any of the above could be correct.