Which of the following is correct concerning the difference between currency futures contract differs from currency options?

I. Options cannot protect the holder against the risk of adverse movements in exchange rates

II. options are more expensive

III. options are available only for relatively short maturities

IV. futures eliminate the possibility of gaining a windfall profit from favorable movements in exchange rates

Answers:

a. II only

b. II and III only

c. III and IV only

d. IV only