What is:

1: Creating and designing securities with custom-tailored characteristics. 6: An equation representing the proper relation between put and call prices. Violation of parity allows arbitrage opportunities. 12: In the money describes an option whose exercise would produce profits. Out of the money describes an option where exercise would not be profitable. 16: refers to differing expiration date.

1: Out of the money describes an option where exercise would not be profitable. 3: The purchase price of an option. 4: Price set for calling (buying) an asset or putting (selling) an asset. 6: Use of a firms call option on a callable convertible bond when the firm knows that bondholders will exercise their option to convert. 8: Purchase of stock combined with a put option that guarantees minimum proceeds equal to the puts exercise price. 10: Earnings per share expressed as if all outstanding convertible securities and warrants have been exercised.