according to the black-scholes option pricing model, keeping other variables constant, increase in the ________ will increase the premium of a call option

a) strike price

b)volatility of the underlying asset pricwe

c)time to maturity

d) B and C

Kalons, Inc. is a U.S.-based MNC that frequently imports raw materials from Canada. Kalonsis typically invoiced for these goods in Canadian dollars and is concerned that the Canadian dollar will appreciate in the near future. Which of the following is notan appropriate hedgingtechnique under these circumstances?

a)purchase canadian dollars forward

b)purchase canadian dollars futures contracts

c)purchase canadian dollars put options

d)purchase canadian dollars call options

A call option on British pounds has a strike (exercise) price of $1.48 per pound. The present exchange rate is $1.55 per pound. This call option can be referred to as:

a) in the money

b) out of the money

c)at the money

d)at a discount.

A put option on British pounds has a strike (exercise) price of $1.48. The present exchange rate is $1.55. This put option can be referred to as:

a) in the money

b) out of the money

c)at the money

d)at a discount.