Expert answer:quiz has posted in file 1 and please give 100 words for each students responds in file 2
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1. The breakeven point for a long put is
A. Identical to the breakeven point for a short put
B. Greater than the breakeven point for a short put
C. Smaller than the breakeven point for a short put
D. A long put does not breakeven
2. Which of the following describes the moneyness of a call
option if the underlying asset price is greater than the strike
price?
A. At-the-out-money
B. At-the-money
C. Out-of-the-money
D. In-the-money
3. A key difference between a call option and a put option is
A. The long position has the right to purchase by a call while the
short position has the right to purchase by a put
B. The long position has the right to purchase by a call while the
long position has the right to sell by a put
C. The long position has the right to purchase by a call while the
short position has the right to sell by a put
D. The long position has the right to sell by a call while the short
position has the tight to purchase by a put
4.The long call is
A. Obligated to purchase the underlying asset from the short call
B. Obligated to sell the underlying asset to the short call
C. Obligated to lend the underlying asset to the short call
D. None of the above
5.Which of the following position has a right and not an
obligation
A. long call
B. short call
C. long forward
D. short forward
Instruction:
In responding to your classmates’ posts, review and/or elaborate on your
classmates’ risk descriptions and examples. Do you see any other
financial risk besides the ones that your classmates shared in their
discussion posts? How might you mitigate the risks that are mentioned?
Support your initial posts and response posts with scholarly sources cited
in APA style. Refer to the Discussion Rubric for directions on completing
these discussions.
Student one:
According to Tyagi, A. (2013), there are seven types of financial risks:
commodity risk, counterparty risk, credit risk, foreign exchange risk,
interest rate risk, sovereign risk, reputational risk and other risks. Depend
on which industry company is, there are different major financial risks.
For EXXON corporation (XOM), I think commodity risk, foreign
exchange risk and interest rate risk are main risk. This is because 1) the
input of firm is natural resource which is easy to be affected by natural
condition; and the recently Houston hurricane is an example. 2) Exxon is
a global company with a lot subsidiaries in the world so the fluctuation of
exchange rate could not be avoided. 3) Energy industry needs a lot of
capital to invest in technology, facility and so on. The change in interest
rate would influence to profit of company. This is the three main financial
risks of company which they should have keep eyes on that.
Student Two:
In this discussion, we are going to focus on the different types of risks
that any business can encounter.
First, we have strategy risk. its determine the risk an organization’s
strategy turns out to be less compelling and your organization problems
to achieve its objectives, therefore. It could be because of innovative
changes, a capable new concurrence entering the market.
Secondly, operational risk. Operational risk refers to a sudden
disappointment in your organization’s everyday operations. It could be a
specialized disappointment, similar to a server blackout, or it could be
caused by the internal stuff or work procedures.
Thirdly, financial risk. Talking about financial risk is really wide but
they always have some points in common which is reputation. When a
company doesn’t have a good reputation, you’ll see a quick loss of
income, as clients end up plainly careful about working with you. on top
of that, there are different impacts, as well as losing your employee by
being disappointed and decide to leave for another corporation.
…
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