The currency option strike price of 163 means that
A) $1 is worth 1.63 units of the foreign currency.
B) $1 is worth 163 units of the foreign currency.
C) one unit of the foreign currency is worth $1.63.
D) one unit of the foreign currency is worth $163.

Question

Quizplus · Accepted Answer

A currency option strike price of 163 means that one unit of the foreign currency is worth $1.63. The strike price is the agreed-upon price at which the option can be exercised. In this case, if the option holder wants to buy or sell a specific amount of the foreign currency, they can do so at a rate of $1.63 per unit.

The Currency Option Strike Price of 163 Means That