A foreign currency ________ option gives the holder the right to ________ a foreign currency, whereas a foreign currency ________ option gives the holder the right to ________ an option.
A) call, buy, put, sell
B) call, sell, put, buy
C) put, hold, call, release
D) none of the above

Question

Quizplus · Accepted Answer

A foreign currency call option gives the holder the right to buy a foreign currency, whereas a foreign currency put option gives the holder the right to sell a foreign currency. Additionally, a call option gives the holder the right to buy an underlying asset (in this case, foreign currency), while a put option gives the holder the right to sell an underlying asset (such as an option). Therefore, option A is the correct answer.

A Foreign Currency ________ Option Gives the Holder the Right