Match List I with List II

List I

List II

Hedging Concepts

Description

A.

European option

I.

Option contract exercised on any date up to maturity

B.

Option premium

II.

When the immediate exercise of an option yields positive value to its holder

C.

In-money option

III.

Option contract exercised only on the maturity date

D.

American option

IV.

It is paid by the buyer of the options upfront to the option seller

Choose the correct answer from the options given below:

1
A ‐ l, B ‐ ll, C ‐ lV, D ‐ lll
2
A ‐ lll, B ‐ lV, C ‐ ll, D ‐ l
3
A ‐ l, B ‐ ll, C ‐ lll, D ‐ lV
4
A ‐ l, B ‐ lV, C ‐ ll, D ‐ lll

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