Multiple Choice
Some of the most common applications of real options are with property and insurance.A real estate option grants the holder the right to buy or sell a piece of property at an established price sometime in the future.If the price of the property goes ________,the owner of the option is likely to buy it.If the market value of the property ________ the strike price,the option holder is unlikely to execute the purchase.
A) down; goes above
B) down; drops below
C) up; drops below
D) up; goes above
Correct Answer:
Verified
Correct Answer:
Verified
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