In January, an investor purchased a European-style April call option on ABC and an American-style May call option in XYZ. Which of the following scenarios is permissible? A. XYZ exercised in April; ABC exercised in March B. XYZ exercised in April; ABC exercised in April C. XYZ exercised in May; ABC exercised in February D. XYZ exercised in June; ABC exercised in April 2. Under SEC rules, which of the following products is a security? A. Silver bullion B. Foreign currency C. An exchange-traded fund (ETF) D. A future on the S&P 500 Index (SPX) 3. The financial risk that a given security is not readily tradeable in the market without impacting the market price is known as: A. Credit risk B. Market risk C. Liquidity risk D. Prepayment risk 4. A negotiated offering is preferable to a competitive offering under which of the following conditions? A. A stable equity market B. Poor credit of the issuer C. A well-established issuer D. Widespread interest in the offering
In January, an investor purchased a European-style April call option on ABC and an American-style May call option in XYZ. Which of the following scenarios is permissible?
A. XYZ exercised in April; ABC exercised in March
B. XYZ exercised in April; ABC exercised in April
C. XYZ exercised in May; ABC exercised in February
D. XYZ exercised in June; ABC exercised in April
2. Under SEC rules, which of the following products is a security?
A. Silver bullion
B. Foreign currency
C. An exchange-traded fund (ETF)
D. A future on the S&P 500 Index (SPX)
3. The financial risk that a given security is not readily tradeable in the market without impacting the market price is known as:
A. Credit risk
B. Market risk
C. Liquidity risk
D. Prepayment risk
4. A negotiated offering is preferable to a competitive offering under which of the following conditions?
A. A stable equity market
B. Poor credit of the issuer
C. A well-established issuer
D. Widespread interest in the offering
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