Practice Set - 1 | Practice Set | NISM Series XVI: Commodity Derivatives Certification Examination

Question 1

An option is 'in the money' when it has intrinsic value.

Question 2

A commodity option gives the buyer:

Question 3

Time value of an option decreases as expiry approaches.

Question 4

Higher volatility increases option premium.

Question 5

Option contracts are leveraged instruments.

Question 6

Option seller’s risk is:

Question 7

Deep ITM options have:

Question 8

Break-even for call option buyer is:

Question 9

A put option gives the holder the right to:

Question 10

Option seller benefits when:

Question 11

Which scenario is most beneficial for option seller?

Question 12

Which of the following describes strike price?

Question 13

American options can be exercised anytime before expiry.

Question 14

If a call option expires out-of-the-money, the buyer:

Question 15

The seller (writer) of an option has an obligation to fulfill the contract if exercised.

Question 16

At-the-money option occurs when:

Question 17

If underlying price does not move, option buyer will likely:

Question 18

Break-even for put option buyer is:

Question 19

Intrinsic value of an option can never be negative.

Question 20

A call option gives the holder the right to:

Question 21

Which option has only time value and no intrinsic value?

Question 22

Option premium consists of intrinsic value and time value.

Question 23

European options can be exercised:

Question 24

Which of the following affects option premium?

Question 25

A call option is in-the-money when:

Question 26

Option buyer’s maximum loss is limited to premium paid.

Question 27

Option premium is:

Question 28

Which option strategy benefits from high volatility?

Question 29

A put option is in-the-money when:

Question 30

Practice Set - 1