ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -A currency option (also known as a forex option) is a contract that gives the buyer the right, but not the obligation, to buy or sell a certain currency at a specified exchange rate on or before a specified date. For this right, a premium is paid to the seller.

Detailed explanation-2: -Call options contracts give holders the right, but not the obligation, to buy some underlying security at a pre-determined price by a set expiration time. Unlike futures or forwards, this means that the call holder can decide whether or not to exercise that right and purchase the asset for that strike price.

Detailed explanation-3: -A cross rate by definition may be any exchange of any two currencies that are not the official currency of the country in which the quote is published.

Detailed explanation-4: -An option is a contract giving the buyer the right, but not the obligation, to buy or sell an underlying asset (a stock or index) at a specific price on or before a certain date (listed options are all for 100 shares of the particular underlying asset).

Detailed explanation-5: -An option is a contract which gives. holder right to buy or sell (but not. obligation) of underlying asset at a. fixed price within a specified period. of time.