What Is a "Put" Option

question 81

Multiple Choice

What is a "put" option?

• A)A contract that gives the holder the right to sell an instrument at a pre-specified price.
• B)A contract that is derived from some other underlying quantity,index,asset or event.
• C)A contract that gives the holder the right to acquire an instrument at a pre-specified price.
• D)A contract that gives the holder the right to buy or sell something at a specified price.

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Definitions:

Government Intervention

Actions taken by a government to influence or regulate economic activity, often to correct market failures and achieve desired social or economic outcomes.

Prices

The sum needed to buy a product or service, shaped by aspects such as the availability of the item and the desire for it from consumers.

Economic Activity

Actions that involve the production, distribution, and consumption of goods and services within an economy.

Market Economy

An economic system where supply and demand from consumers and businesses drive the production and allocation of resources and services, with minimal government intervention.